Artikel
Relative pay, effort, and labor supply
Recent studies show that even irrelevant relative pay information—earnings compared to the past or to others—significantly affects workers’ willingness to work (labor supply) and effort. This effect stems mainly from those whose pay compares unfavorably; accordingly, earning less compared to others or less than in the past significantly reduces one’s willingness to work and effort exerted on the job. Comparing favorably, however, has mixed effects—with usually no effect on effort, but positive or no effects on labor supply. Understanding when relative pay increases labor supply and effort can thus help firms devise optimal payment structures.
- Language
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Englisch
- Bibliographic citation
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Journal: IZA World of Labor ; ISSN: 2054-9571 ; Year: 2017 ; Bonn: Institute for the Study of Labor (IZA)
- Classification
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Wirtschaft
Wages, Compensation, and Labor Costs: General
- Subject
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relative pay
effort
labor supply
lab experiments
field experiments
- Event
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Geistige Schöpfung
- (who)
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Bracha, Anat
- Event
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Veröffentlichung
- (who)
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Institute for the Study of Labor (IZA)
- (where)
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Bonn
- (when)
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2017
- DOI
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doi:10.15185/izawol.367
- Handle
- Last update
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10.03.2025, 11:44 AM CET
Data provider
This object is provided by:
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
Object type
- Artikel
Associated
- Bracha, Anat
- Institute for the Study of Labor (IZA)
Time of origin
- 2017
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