In Search of Workers' Real Effort Reciprocity - A Field and a Laboratory Experiment

Hennig-Schmidt, Heike and Rockenbach, Bettina and Sadrieh, Abdolkarim (July 2005): In Search of Workers' Real Effort Reciprocity - A Field and a Laboratory Experiment. SFB/TR 15 Discussion Paper No. 55

Abstract

We present a field experiment to assess the effect of own and peer wage variations on actual work effort of employees with hourly wages. Work effort neither reacts to an increase of the own wage, nor to a positive or negative peer comparison. This result seems at odds with numerous laboratory experiments that show a clear own wage sensitivity on effort. In an additional real-effort laboratory experiment we show that explicit cost and surplus information that enables to exactly calculate employer’s surplus from the work contract is a crucial pre-requisite for a positive wage-effort relation. This demonstrates that employee’s reciprocity requires a clear assessment of the surplus at stake.

• Item Type: Paper (Discussion Paper)
• Keywords: efficiency wage, reciprocity, fairness, field experiment, real effort
• Collections: Special Research Fields > Discussion Paper Series of SFB/TR 15 Governance and the Efficiency of Economic Systems; Special Research Fields > Discussion Paper Series of SFB/TR 15 Governance and the Efficiency of Economic Systems > C4 - Experimentelle Analyse von rationalen und beschränkt rationalen Theorien des Marktverhaltens
• Subjects: 300 Social sciences > 330 Economics
• JEL Classification: C91, C92, J41
• Language: English