convinced that their manager cares for them. Managers can signal their altruistic feelings towards their employees in two ways … altruistic managers may offer lower wages and nevertheless build up better social-exchange relationships with their employees … than egoistic managers do. In such equilibria, a low wage signals to employees that the manager has something else to offer …

, managers therefore need to think about how to create and preserve highquality co-worker relationships. This paper develops a … colleagues, which in turn creates co-worker altruism. We study how financial incentives for productive activities can improve or … damage the work climate. We show that both team incentives and relative incentives can help to create a good work climate. We …

findings suggest that, when managers engage in wasteful capital expenditures, welfare may decline if the cost of investment is …

interaction with monetary incentives. We find that motivational talk significantly improves performance only if it is accompanied …

reduce the effort costs of a worker, and analyze the optimal combination of motivational effort and monetary incentives. We … distinguish two cases. First, the firm owner chooses the intensity of motivation and bears the motivational costs. Second, another … conditions under which monetary incentives and motivational effort are substitutes or complements, and show that motivational …

feasible alternatives to punishment exist, such as offering positive incentives or handing out awards for law abiding behavior …

, endogenous formation of efficient long-run employment relations. Our results inform the theory of the firm by showing how …

We study the relation between formal incentives and social exchange in organizations where employees work for several … managers and reciprocate a manager's attention with higher effort. To this end we develop a common agency model with two … autonomy of effort choice to employees and giving bonus pay to both managers and employees. When neither effort nor attention …

a subsequent social dilemma. Our motivation stems from the existence of contrasting views on the potential spillover …