Efficiency wages in an experimental labor market

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There has been recent experimental support for efficiency wage theories of the labor market. This short paper initiates the larger process of evaluating the boundary conditions of the gift-exchange phenomenon. In particular, we will see whether behavior consistent with the fair wage-effort hypothesis can emerge and be sustained under conditions in which there is (i) a nontrivial marginal cost to providing effort and (ii) increased social distance between subject and experimenter.

Original languageEnglish (US)
Pages (from-to)13348-13351
Number of pages4
JournalProceedings of the National Academy of Sciences of the United States of America
Issue number20
StatePublished - Oct 1 2002
Externally publishedYes

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