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On the role of social wage comparisons in gift-exchange experiments

Author

Listed:
  • Siang, Ch'ng Kean
  • Requate, Till
  • Waichman, Israel

Abstract

This study extends a bilateral gift exchange experiment by Clark et al. (2010) who investigate how feedback of information about wages paid in the market affects both employers' wage setting and workers' performance. We provide either quantitative or qualitative information on the average wage paid in all worker-employer-relationships, and we also study repeated relationships (fixedmatching). We find that information on the average wage reduces (increases) both wage offers and effort levels in one-shot (repeated) relationships.

Suggested Citation

  • Siang, Ch'ng Kean & Requate, Till & Waichman, Israel, 2010. "On the role of social wage comparisons in gift-exchange experiments," Economics Working Papers 2010-11, Christian-Albrechts-University of Kiel, Department of Economics.
    • Handle: RePEc:zbw:cauewp:201011
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    1. is not listed on IDEAS
    2. Becker, Johannes & Hopp, Daniel & Süß, Karolin, 2020. "How altruistic is indirect reciprocity? - Evidence from gift-exchange games in the lab," VfS Annual Conference 2020 (Virtual Conference): Gender Economics 224592, Verein für Socialpolitik / German Economic Association.
    3. Feng, Jun & Ho, Chun-Yu & Qin, Xiangdong, 2022. "Internal and external reference dependence of incomplete contracts: Experimental evidences," Journal of Economic Behavior & Organization, Elsevier, vol. 203(C), pages 189-209.
    4. Gary Charness & Ramón Cobo-Reyes & Juan A. Lacomba & Francisco Lagos & Jose Maria Perez, 2016. "Social comparisons in wage delegation: experimental evidence," Experimental Economics, Springer;Economic Science Association, vol. 19(2), pages 433-459, June.
    5. Elwyn Davies & Marcel Fafchamps, 2017. "When No Bad Deed Goes Punished: Relational Contracting in Ghana versus the UK," NBER Working Papers 23123, National Bureau of Economic Research, Inc.
    6. Israel Waichman & Ch’ng Kean Siang & Till Requate & Aric P. Shafran & Eva Camacho-Cuena & Yoshio Iida & Shosh Shahrabani, 2015. "Reciprocity in Labor Market Relationships: Evidence from an Experiment across High-Income OECD Countries," Games, MDPI, vol. 6(4), pages 1-22, October.
    7. Fortuna Casoria & Arno Riedl, 2013. "Experimental Labor Markets And Policy Considerations: Incomplete Contracts And Macroeconomic Aspects," Journal of Economic Surveys, Wiley Blackwell, vol. 27(3), pages 398-420, July.
    8. Thomas Longden & David Throsby, 2021. "Non‐Pecuniary Rewards, Multiple Job‐Holding and the Labour Supply of Creative Workers: The Case of Book Authors," The Economic Record, The Economic Society of Australia, vol. 97(316), pages 24-44, March.
    9. Hopp, Daniel & Süß, Karolin, 2024. "How altruistic is indirect reciprocity? — Evidence from gift-exchange games in the lab," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 108(C).
    10. Davies, Elwyn & Fafchamps, Marcel, 2021. "When no bad deed goes punished: Relational contracting in Ghana and the UK," Journal of Economic Behavior & Organization, Elsevier, vol. 191(C), pages 714-737.

    More about this item

    Keywords

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    JEL classification:

    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • D03 - Microeconomics - - General - - - Behavioral Microeconomics: Underlying Principles
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • J41 - Labor and Demographic Economics - - Particular Labor Markets - - - Labor Contracts

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