Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/30745 
Year of Publication: 
2010
Series/Report no.: 
CESifo Working Paper No. 2944
Publisher: 
Center for Economic Studies and ifo Institute (CESifo), Munich
Abstract: 
An important aspect in determining the effectiveness of gift exchange relations in labor markets is the ability of the worker to repay the gift to the employer. To test this hypothesis, we conduct a real effort laboratory experiment where we vary the wage and the effect of the worker's effort on the manager's payoff. Furthermore we collect additional information that allows us to control for the workers' ability and whether they can be classified as reciprocal or not. From our agency model of reciprocal motivation we derive non-trivial predictions about which is the marginal worker (in terms of ability) affected by our experimental variation and how different types of individuals, selfish and reciprocal, will react to it. Our model does substantially better than other theories in organizing the data.
Subjects: 
reciprocity
fairness
real effort experiment
personality tests
JEL: 
C91
J33
M52
Document Type: 
Working Paper
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