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Title:Effort and comparison income: experimental and survey evidence PDF Logo
Authors:Clark, Andrew E.
Masclet, David
Villeval, Marie-Claire
Issue Date:2006
Series/Report no.:IZA Discussion Papers 2169
Abstract:This paper considers the effect of status or relative income on work effort combining experimental evidence from a gift-exchange game with ISSP survey data. We find a consistent negative effect of others' incomes on individual effort in both datasets. The individual's rank in the income distribution is a stronger determinant of effort than others' average income, suggesting that comparisons are more ordinal than cardinal. We then show that effort is also affected by comparisons over time: those who received higher income offers or had higher income rank in the past exert lower levels of effort for a given current income and rank.
Subjects:effort
comparison income
rank
peak-end
experiments
JEL:M54
J33
A13
C92
D63
Document Type:Working Paper
Appears in Collections:IZA Discussion Papers, Forschungsinstitut zur Zukunft der Arbeit (IZA)

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