Logo Logo
Switch Language to German

Bartling, Björn; Fehr, Ernst and Schmidt, Klaus M. ORCID logoORCID: https://orcid.org/0000-0002-5011-0828 (June 2012): Discretion, Productivity and Work Satisfaction. SFB/TR 15 Discussion Paper No. 383 [PDF, 287kB]

There is a more recent version of this item available.


In Bartling, Fehr and Schmidt (2012) we show theoretically and experimentally that it is optimal to grant discretion to workers if (i) discretion increases productivity, (ii) workers can be screened by past performance, (iii) some workers reciprocate high wages with high effort and (iv) employers pay high wages leaving rents to their workers. In this paper we show experimentally that the productivity increase due to discretion is not only sufficient but also necessary for the optimality of granting discretion to workers. Furthermore, we report representative survey evidence on the impact of discretion on workers’ welfare, confirming that workers earn rents.

Available Versions of this Item

Actions (login required)

View Item View Item