Desert and Inequity Aversion in Teams

David Gill and Rebecca Stone ()
Additional contact information
Rebecca Stone: University of California, Los Angeles

No 8444, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: Teams are becoming increasingly important in work settings. We develop a framework to study the strategic implications of a meritocratic notion of desert under which team members care about receiving what they feel they deserve. Team members find it painful to receive less than their perceived entitlement, while receiving more may induce pleasure or pain depending on whether their preferences exhibit desert elation or desert guilt. Our notion of desert generalizes distributional concern models to situations in which effort choices affect the distribution perceived to be fair; in particular, desert nests inequity aversion over money net of effort costs as a special case. When identical teammates share team output equally, desert guilt generates a continuum of symmetric equilibria. Equilibrium effort can lie above or below the level in the absence of desert, so desert guilt generates behavior consistent with both positive and negative reciprocity and may underpin social norms of cooperation.

Keywords: desert; deservingness; equity; inequity aversion; loss aversion; reference-dependent preferences; guilt; reciprocity; social norms; team production (search for similar items in EconPapers)
JEL-codes: D63 J33 (search for similar items in EconPapers)
Pages: 38 pages
Date: 2014-08
New Economics Papers: this item is included in nep-hrm, nep-mic and nep-soc
References: View references in EconPapers View complete reference list from CitEc
Citations:

Published - published in: Journal of Public Economics, 2015, 123, 42-54

Downloads: (external link)
https://docs.iza.org/dp8444.pdf (application/pdf)

Related works:
Journal Article: Desert and inequity aversion in teams (2015)
Working Paper: Desert and inequity aversion in teams (2012)
Working Paper: Desert and Inequity Aversion in Teams (2011)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:iza:izadps:dp8444

Ordering information: This working paper can be ordered from
IZA, Margard Ody, P.O. Box 7240, D-53072 Bonn, Germany

Access Statistics for this paper

More papers in IZA Discussion Papers from Institute of Labor Economics (IZA) IZA, P.O. Box 7240, D-53072 Bonn, Germany. Contact information at EDIRC.
Bibliographic data for series maintained by Holger Hinte ().