Smith, Jennifer C. (2013) Pay growth, fairness and job satisfaction : implication for nominal and real wage rigidity. Working Paper. Coventry, UK: Department of Economics, University of Warwick. CAGE Online Working Paper Series, Volume 2013 (Number 130).

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Abstract

Theories of wage rigidity often rely on a positive relationship between pay changes
and utility, arising from concern for fairness or gift exchange. Supportive evidence has
emerged from laboratory experiments, but the link has not yet been established with
Öeld data. This paper contributes a Örst step, using representative British data. Workers
care about the level and the growth of earnings. Below-median wage increases lead to an
insult e§ect except when similar workers have real wage reductions or Örm production
is falling. Nominal pay cuts appear insulting even when the Örm is doing badly.

Item Type:	Working or Discussion Paper (Working Paper)
Divisions:	Faculty of Social Sciences > Economics
Series Name:	CAGE Online Working Paper Series
Publisher:	Department of Economics, University of Warwick
Place of Publication:	Coventry, UK
Official Date:	2013
Dates:	Date Event 2013 Published
Volume:	Volume 2013
Number:	Number 130
Number of Pages:	34
Institution:	University of Warwick
Status:	Peer Reviewed
Publication Status:	Published
Related URLs:	Related item in WRAP

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