Beiträge zur Jahrestagung des Vereins für Socialpolitik 2019: 30 Jahre Mauerfall - Demokratie und Marktwirtschaft - Session: Experimental Economics I No. A06-V3
This paper investigates how negotiations between employers and employees respond to exogenous and endogenous wage transparency. In a treatment with exogenous wage transparency, employers' offers increase significantly compared to the case when offers are private information. Moreover, the share of equal wage offers becomes larger. Employers and employees rarely induce transparency themselves. In a treatment where employees could enforce transparency, average wage offers are significantly lower than in the other treatments. Thus, employees forego potential wage increases by staying ignorant about co-workers' offers. Taken together, these findings have important implications for recent policies aimed at increasing wage transparency.
Wage transparency wage negotiations real-effort gift exchange experiment