Unfair Pay and Health

Armin Falk, Fabian Kosse, Ingo Menrath, Pablo Emilio Verde and Johannes Siegrist
Additional contact information
Ingo Menrath: Heinrich Heine University, Department of Medical Sociology
Pablo Emilio Verde: Heinrich Heine University, Department of Medical Sociology
Johannes Siegrist: Heinrich Heine University, Department of Medical Sociology

No 2016-015, Working Papers from Human Capital and Economic Opportunity Working Group

Abstract: This paper investigates physiological responses to perceptions of unfair pay. We use an integrated approach exploiting complementarities between controlled lab and representative panel data. In a simple principal-agent experiment agents produce revenue by working on a tedious task. Principals decide how this revenue is allocated between themselves and their agents. Throughout the experiment we record agents' heart rate variability, which is an indicator of stress-related impaired cardiac autonomic control, and which has been shown to predict coronary heart disease in the long-run. Our findings establish a link between unfair payment and heart rate variability. Building on these findings, we further test for potential adverse health effects of unfair pay using observational data from a large representative panel data set. Complementary to our experimental findings we show a strong and significant negative association between unfair pay and health outcomes, in particular cardiovascular health.

Keywords: fairness; social preferences; Inequality; heart rate variability; Health; experiment; SOEP (search for similar items in EconPapers)
JEL-codes: C91 D03 D63 I14 (search for similar items in EconPapers)
Date: 2016-06
New Economics Papers: this item is included in nep-exp, nep-ger, nep-hea and nep-hrm
Note: IP
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://humcap.uchicago.edu/RePEc/hka/wpaper/Falk_K ... l_2016_unfairpay.pdf First version, April, 2016 (application/pdf)

Related works:
Working Paper: Unfair Pay and Health (2018)
Working Paper: Unfair Pay and Health (2016)
Working Paper: Unfair Pay and Health (2014)
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Persistent link: https://EconPapers.repec.org/RePEc:hka:wpaper:2016-015

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