Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/32626
Year of Publication: 
2010
Series/Report no.: 
Jena Economic Research Papers No. 2010,016
Publisher: 
Friedrich Schiller University Jena and Max Planck Institute of Economics, Jena
Abstract: 
One-shot interaction and repeated interaction often co-exist in the real world. We study possible behavioral effects of this co-existence in a principal-agent setting, in which a principal simultaneously employs a permanent and a temporary agent. Our experimental results indicate that there is 'discrimination' between the two agents and that the available information for agents determines the extent of this discrimination, even though the theoretical solution of the game implies equal treatment of agents. Discrimination is, thus, a consequence of reciprocity. Agents that are discriminated against react negatively by withholding effort.
Subjects: 
principal-agent problem
permanent and temporary employment
fairness
wage discrimination
JEL: 
C72
C91
D21
J31
Document Type: 
Working Paper

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