Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/55326
Authors: 
Englmaier, Florian
Leider, Stephen G.
Year of Publication: 
2012
Series/Report no.: 
CESifo working paper: Behavioural Economics 3707
Abstract: 
We conduct a field experiment where we vary both the presence of a gift exchange wage and the effect of the worker's effort on the manager's payoff. The results indicate a strong complementarity between the initial wage gift and the agent's ability to repay the gift. We collect information on ability to control for differences and on reciprocal inclination to show that gift exchange is more effective with more reciprocal agents. We present a simple principal-agent model with reciprocal subjects that motivates our empirical findings. Our results offer an avenue to reconcile the recent conflicting evidence on the efficacy of gift exchange outside the lab; we suggest that the significance of gift exchange relations depends on details of the environment.
Subjects: 
incentives
reciprocity
gift exchange
field experiments
JEL: 
C91
J33
M52
Document Type: 
Working Paper

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