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Driving Forces Behind Informal Sanctions

Falk, Armin; Fehr, Ernst; Fischbacher, Urs - Institute for the Study of Labor (IZA) - 2005

theories of fairness and reciprocity capture these forces. We find that cooperators’ punishment is almost exclusively targeted … towards the defectors but the latter also impose a considerable amount of spiteful punishment on the cooperators. However …, spiteful punishment vanishes if the punishers can no longer affect the payoff differences between themselves and the punished …

Persistent link: https://www.econbiz.de/10005703785

Moral Hypocrisy, Power and Social Preferences

Rustichini, Aldo; Villeval, Marie Claire - Institute for the Study of Labor (IZA) - 2012

We show with a laboratory experiment that individuals adjust their moral principles to the situation and to their …

Persistent link: https://www.econbiz.de/10011279283

The Behavioral Effects of Minimum Wages

Falk, Armin; Fehr, Ernst; Zehnder, Christian - Institute for the Study of Labor (IZA) - 2005

The prevailing labor market models assume that minimum wages do not affect the labor supply schedule. We challenge this view in this paper by showing experimentally that minimum wages have significant and lasting effects on subjects’ reservation wages. The temporary introduction of a minimum...

Persistent link: https://www.econbiz.de/10005762121

How Do Informal Agreements and Renegotiation Shape Contractual Reference Points?

Fehr, Ernst; Hart, Oliver; Zehnder, Christian - Institute for the Study of Labor (IZA) - 2011

Previous experimental work provides encouraging support for some of the central assumptions underlying Hart and Moore (2008)’s theory of contractual reference points. However, existing studies ignore realistic aspects of trading relationships such as informal agreements and ex post...

Persistent link: https://www.econbiz.de/10009371874

Do the Reciprocal Trust Less?

Dohmen, Thomas; Altmann, Steffen; Wibral, Matthias - Institute for the Study of Labor (IZA) - 2007

We study the intrapersonal relationship between trust and reciprocity in a laboratory experiment. Reciprocal subjects …

Persistent link: https://www.econbiz.de/10005822399

Do Legal Standards Affect Ethical Concerns of Consumers?

Engelmann, Dirk; Kübler, Dorothea - Institute for the Study of Labor (IZA) - 2007

In order to address the impact of regulation on ethical concerns of consumers, we study the effect of a minimum wage. In our experimental market, consumers have monopsony power, firms engage in Bertrand competition, and workers are passive recipients of a wage payment. Two treatments are...

Persistent link: https://www.econbiz.de/10005822863

Use and Abuse of Authority: A Behavioral Foundation of the Employment Relation

Bartling, Björn; Fehr, Ernst; Schmidt, Klaus M. - Institute for the Study of Labor (IZA) - 2012

Employment contracts give a principal the authority to decide flexibly which task his agent should execute. However, there is a tradeoff, first pointed out by Simon (1951), between flexibility and employer moral hazard. An employment contract allows the principal to adjust the task quickly to...

Persistent link: https://www.econbiz.de/10010598089

Cardiovascular Consequences of Unfair Pay

Falk, Armin; Menrath, Ingo; Verde, Pablo Emilio; … - Institute for the Study of Labor (IZA) - 2011

This paper investigates physiological responses to perceptions of unfair pay. In a simple principal agent experiment … experiment we record agents' heart rate variability. Our findings provide evidence of a link between perceived unfairness and … test potential adverse health effects of unfair pay using data from a large representative data set. Complementary to our …

Persistent link: https://www.econbiz.de/10009024593

Preferences for Redistribution and Pensions: What Can We Learn from Experiments?

Tausch, Franziska; Potters, Jan; Riedl, Arno - Institute for the Study of Labor (IZA) - 2010

Redistribution is an inevitable feature of collective pension schemes and economic experiments have revealed that most people have a preference for redistribution that is not merely inspired by self-interest. Interestingly, little is known on how these preferences interact with preferences for...

Persistent link: https://www.econbiz.de/10008548714