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Sick pay is a common provision in most labor contracts. This paper employs an experimental gift-exchange environment to explore two related questions using both managers and undergraduates as subjects. First, do workers reciprocate sick pay in the same way as they reciprocate wage payments?...
Persistent link: https://www.econbiz.de/10003770700
The question whether a minimum rate of sick pay should be mandated is much debated. We study the effects of this kind of intervention in an experimental labor market that is rich enough to allow for moral hazard, adverse selection, and crowding out of good intentions to occur. We find that...
Persistent link: https://www.econbiz.de/10003883284
Sick-pay is a common provision in labor contracts. It insures workers against a sudden loss of income due to unexpected absences and helps them smooth consumption. Therefore, many governments find sick-pay socially desirable and choose to mandate its provision. But sick-pay is not without its...
Persistent link: https://www.econbiz.de/10003949628
reciprocity. Moreover, several theoretical papers have been written showing that the observed phenomena can be explained in a …
Persistent link: https://www.econbiz.de/10011397676
We show that concerns for fairness may have dramatic consequences for the optimal provision of incentives in a moral hazard context. Incentive contracts that are optimal when there are only selfish actors become inferior when some agents are concerned about fairness. Conversely, contracts that...
Persistent link: https://www.econbiz.de/10011398105
available appropriation behavior is more efficient. Our analysis shows that these regularities arise naturally when a fraction …
Persistent link: https://www.econbiz.de/10011398786
How do firms motivate their employees to be productive? The conventional wisdom is that workers respond to monetary incentives - "Pay them more and they will work harder." However, a large and growing body of empirical evidence from laboratory and field experiments, surveys, and observational...
Persistent link: https://www.econbiz.de/10011413663
We report on several experiments on the optimal allocation of ownership rights. The experiments confirm the property rights approach by showing that the ownership structure affects relationship-specific investments and that subjects attain the most efficient ownership allocation despite starting...
Persistent link: https://www.econbiz.de/10010261192
We analyze the effects of reciprocity on the performance of a two-player team working in a venture. The players … reciprocity). However, over time, the chance to change direction (switch projects) unexpectedly arises, creating conflict between …, and may lead to retaliation (negative reciprocity). Positive and negative reciprocity may combine to prevent project …
Persistent link: https://www.econbiz.de/10013136638
.g., legislators) are induced to display reciprocal and pro-social behavior. However, the question of how a voting mechanism can be … designed to incentivize ``selfish" individuals to display such behavior remains unresolved. We propose such a mechanism and … equilibrium concept--the reciprocity set--that satisfies all of the aforementioned properties under mild conditions, and it is …
Persistent link: https://www.econbiz.de/10012850001