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Games of status and discriminatory contracts
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Dhillon, Amrita and Hertzog-Stein, Alexander (2009) Games of status and discriminatory contracts. Games and economic behavior, Vol.65 (No.1). pp. 105-123. doi:10.1016/j.geb.2008.03.009 ISSN 0899-8256.
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Official URL: http://dx.doi.org/10.1016/j.geb.2008.03.009
Abstract
Following recent empirical evidence which indicates the importance of rank for the determination of workers' wellbeing, this paper introduces status seeking preferences in the form of rank-dependent utility functions into a moral
hazard framework with one firm and multiple workers, but no correlation in production. We show that workers' concern for the rank of their wage in the firm's wage distribution induces the firm to offer discriminatory wage contracts when its aim is to induce all workers to expend effort.
Item Type: | Journal Article | ||||
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Subjects: | H Social Sciences > HB Economic Theory | ||||
Divisions: | Faculty of Social Sciences > Economics | ||||
Library of Congress Subject Headings (LCSH): | Employee incentives, Moral hazard -- Mathematical models, Simulation games | ||||
Journal or Publication Title: | Games and economic behavior | ||||
Publisher: | Elsevier | ||||
ISSN: | 0899-8256 | ||||
Official Date: | January 2009 | ||||
Dates: |
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Volume: | Vol.65 | ||||
Number: | No.1 | ||||
Page Range: | pp. 105-123 | ||||
DOI: | 10.1016/j.geb.2008.03.009 | ||||
Status: | Peer Reviewed | ||||
Access rights to Published version: | Open Access (Creative Commons) | ||||
Funder: | Economic and Social Research Council (Great Britain) (ESRC), University of Warwick |
Data sourced from Thomson Reuters' Web of Knowledge
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