DOES MANAGERIAL COMPENSATION AFFECT WORKERS' EFFORT?

Download

index.pdf

Date

2015-11-01

Author

Hesse, Nils
Rivas, Maria Fernanda

Metadata

Show full item record

This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.

Item Usage Stats

149
views

0
downloads

We explore in a two-level gift-exchange experiment whether the managerial compensation influences workers' effort decisions. Firstly, we find that there exists a strong positive relation between own wage and effort levels for the workers, while the managers' effort reaches a maximum for intermediate wages and decreases for very high wages. Secondly, our data suggests that the managerial compensations are significantly negatively correlated with the workers' effort choices: the higher the manager's wage, the lower the effort level chosen by the workers.

Subject Keywords

Managerial compensation, Social preferences, Laboratory experiment, Gift-exchange, Effort

URI

https://hdl.handle.net/11511/65102

Journal

JOURNAL OF APPLIED ECONOMICS

DOI

https://doi.org/10.1016/s1514-0326(15)30013-1

Collections

Economics and Administrative Sciences, Article

Suggestions

OpenMETU
Core

Do corporate governance practices affect CEO compensation? The moderating effect of economic freedom on corporate governance - CEO compensation relationship: an international study Akgün, Şahin.; Sayarı Marcum, Naz,; Department of Business Administration (2019) This study analyzes the association between corporate governance and CEO compensation adopting the “Agency Theory” and “Managerial Power Theory”. First, we examine the direct relationship between corporate governance indicators (such as board structure, employee representatives on board, CEO duality, board independence, institutional share ownership, and insider share ownership) and CEO compensation. Second, the study concentrates on the moderating effect of firm performance on corporate governance – CEO co...
Inequity aversion in three level hierarchies Tel, Muhammed; Küçükşenel, Serkan; Department of Economics (2022-2) This thesis studies the impacts of wage differences between employees and their immediate superiors in the principal-supervisor-agent framework. It integrates Fehr and Schmidt's (1999) inequity aversion approach into Tirole's (1986) three-level hierarchical model. Due to the inequity averse employees, we observe alterations in the optimal contract parameters as well as the collusion structure. If the supervisor’s sensitivity to being behind the principal is higher than the agent’s sensitivity to being behin...
Do R& D expenditures matter for labor productivity in OECD countries? an unresolved question Erdil, Erkan; Çorakcı, Ayşegül (2013-01-01) The aim of this study is to analyze the relationship between labor productivity and R&D expenditures. We have tested this relationship using a panel of 22 OECD countries that covers the period 1991-2003. A Cobb-Douglas production function was estimated in growth form where physical capital, knowledge capital, human capital, and labor stock were included as the factors of production. The estimation results that also controlled for the effect of openness, and R&D spillovers implied a positive long-run R&D ela...
The Effects of psychological capital and social capital on nurses’ work engagement and burnout El, İsmail; Toker, Yonca; Department of Psychology (2019) In today’s challenging business world, for human resources management and organizations, dealing with work engagement and burnout have always been a challenging task regarding their positive and negative outcomes to the organization. Besides, the occupational context of health sector is mostly regarded as stress-filled (Tennant, 2001). In order to deliver a high quality healthcare service, organizations need to develop and boost the staff’s intrapersonal and social resources so as to make them more engaged ...
Do US Corporate Governance Standards Effectively Discourage Risk in the Emerging Markets? Sayari, Naz; Marcum, Bill (2018-06-01) This study provides an examination of the effect of various corporate governance factors on the management of the risks inherent in business and the potential divergent impact of these factors on US firms and firms in emerging countries. In particular, the study scrutinises corporate governance and corporate risk-taking behaviour across different political and socioeconomic environments. In a cross-sectional time-series setting, two-step generalised least squares regression outcomes reveal that the impact o...

Citation Formats

N. Hesse and M. F. Rivas, “DOES MANAGERIAL COMPENSATION AFFECT WORKERS’ EFFORT?,” JOURNAL OF APPLIED ECONOMICS, pp. 297–323, 2015, Accessed: 00, 2020. [Online]. Available: https://hdl.handle.net/11511/65102.