Arbeitspapier
Fairness, Adverse Selection, and Employment Contracts
This paper considers a firm whose potential employees have private information on both their productivity and the extent of their fairness concerns. Fairness is modelled as inequity aversion, where fair-minded workers suffer if their colleagues get more income net of production costs. Screening workers with equal productivity but different fairness concerns is shown to be impossible if both types are to be employed, thereby rendering the optimal employment contracts discontinuous in the fraction of fair-minded workers. As a result, fairness might influence the employment contracts of all workers although only some are fair-minded, and identical firms facing very similar pools of workers might employ very different remuneration schemes.
- Sprache
-
Englisch
- Erschienen in
-
Series: SFB/TR 15 Discussion Paper ; No. 58
- Klassifikation
-
Wirtschaft
Game Theory and Bargaining Theory: General
Firm Behavior: Theory
Market Structure, Pricing, and Design: Monopoly
Equity, Justice, Inequality, and Other Normative Criteria and Measurement
Asymmetric and Private Information; Mechanism Design
Wage Level and Structure; Wage Differentials
- Thema
-
Fairness
Employment Contracts
Adverse Selection
Screening
Heterogeneity in Organizational Form
- Ereignis
-
Geistige Schöpfung
- (wer)
-
von Siemens, Ferdinand
- Ereignis
-
Veröffentlichung
- (wer)
-
Sonderforschungsbereich/Transregio 15 - Governance and the Efficiency of Economic Systems (GESY)
- (wo)
-
München
- (wann)
-
2005
- DOI
-
doi:10.5282/ubm/epub.13492
- Handle
- URN
-
urn:nbn:de:bvb:19-epub-13492-6
- Letzte Aktualisierung
-
10.03.2025, 11:42 MEZ
Datenpartner
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Objekttyp
- Arbeitspapier
Beteiligte
- von Siemens, Ferdinand
- Sonderforschungsbereich/Transregio 15 - Governance and the Efficiency of Economic Systems (GESY)
Entstanden
- 2005
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