The productivity puzzle and the problem with the rich: An experiment on competition, inequality and "team spirit"

Shaun Hargreaves Heap, Abhijit Ramalingam and Brock Stoddard
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Shaun Hargreaves Heap: King's College London

No 17-03, Working Paper series, University of East Anglia, Centre for Behavioural and Experimental Social Science (CBESS) from School of Economics, University of East Anglia, Norwich, UK.

Abstract: This paper examines with an experiment a new way that inequality and competition may interact to affect productivity: through team public goods contributions. While inequality within a team diminishes team cooperation in the absence of competition, we find there is no effect of inequality when teams compete. Competition boosts cooperation and more so in unequal teams. Thus, a decline in competition accompanied by growing inequality has a doubly adverse effect on productivity. The difference in the effect of inequality is driven by the behaviour of the 'rich'. They disengage from their teams but recover their 'team spirit' under competition.

Keywords: public goods; experiment; team competition; inequality; endowment; within-group (search for similar items in EconPapers)
JEL-codes: C72 C91 C92 D31 D63 D72 H41 (search for similar items in EconPapers)
Date: 2017-04-05
New Economics Papers: this item is included in nep-cbe, nep-cdm, nep-exp and nep-gth
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