Working paper

Reciprocity and Payment Schemes: When Equality Is Unfair

Abstract:

A growing literature stresses the importance of reciprocity, especially for employment relations. In this paper, we study the interaction of different payment modes with reciprocity. In particular, we analyze how equal wages affect performance and efficiency in an environment characterized by contractual incompleteness. In our experiment, one principal is matched with two agents. The principal pays equal wages in one treatment and can set individual wages in the other. We find that the use of...

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Authors

Volume:
2500
Series:
IZA Discussion Paper Series
Publication date:
2006-12-05
URN:
uuid:8f8d6f54-4922-4a97-9703-c622ceb3f9c9
Local pid:
oai:economics.ouls.ox.ac.uk:15286
Language:
English