Fair wages survive multiple sources of income inequality

Karina Gose

Economics Letters, 2013, vol. 121, issue 3, 473-477

Abstract: When an employee in a gift exchange game earns significantly less than the employer, the source of employer income does not affect effort choices. However, to induce one unit of effort, the employer has to pay higher wages than in a game without payoff inequality.

Keywords: Gift exchange; Fair wage–effort hypothesis; Reciprocity; Inequity aversion; Tit for tat (search for similar items in EconPapers)
JEL-codes: C91 D31 M52 (search for similar items in EconPapers)
Date: 2013
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Citations: View citations in EconPapers (2)

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Working Paper: Fair Wages Survive Multiple Sources of Income Inequality (2013)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:121:y:2013:i:3:p:473-477

DOI: 10.1016/j.econlet.2013.09.031

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