This paper investigates the role of social identity in reactions to control. We propose a simple principal-agent model with control that incorporates the existence of social groups. Our laboratory experiment shows that, in contrast to no-group agents, agents in social groups (i) perform better;...

We analyze the effects of lower bounds on wages, e.g., minimum wages or liability limits, on job design within firms. In our model, two tasks contribute to non-verifiable firm value and affect an imperfect performance measure. The tasks can be assigned to either one or two agents. In the absence...

We analyze the effects of wage floors on optimal job design in a moral-hazard model with asymmetric tasks and imperfect aggregate performance measurement. Due to cost advantages of specialization, assigning the tasks to different agents is efficient. A sufficiently high wage floor, however,...

Using both household and linked-employer-employee data we study the effects of works councils on individual sickness absence rates and a subjective measure of personnel problems due to absenteeism in Germany. We find that the existence of a works council is positively correlated with the...

We study gender diversity and performance in endogenously formed teams. Participants choose to either perform a cooperation task with members of the own gender only or in a mixed-gender team. We find that independent of the team choice, initially men cooperate significantly more than women. In...

In a repeated real effort team production experiment workers receive a distorted signal about their co-players’ previous efforts. We vary the degree to which production can be directly traced back to a participant’s real or randomly drawn effort level. We find that individuals produce much...

Nowadays, the lack of high qualified staff is more conspicuous than ever before. The development of new knowledge and professions is followed by the modern technological changes, enormous usage of Internet and development of artificial intelligence. These trends have led to changes in the...

The article is concerned with understanding the impact of social preferences and wealth inequality on aggregate economic outcomes. We investigate how different manifestations of other-regarding preferences affect incentive contracts at the microeconomic level and how these in turn translate into...