Interpersonal Comparison, Status and Ambition in Organisations.
This paper argues that the prevalence of compensation systems which reward winners without explicitly identifying losers can be rationalized by workers' concern for relative payo¤s. If the workers' participation constraints are binding, the …rm must compensate its employees for the disutil...
| Main Authors: | , |
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| Format: | Working paper |
| Language: | English |
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Department of Economics (University of Oxford)
2005
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| _version_ | 1797100701595205632 |
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| author | Ederer, F Patacconi, A |
| author_facet | Ederer, F Patacconi, A |
| author_sort | Ederer, F |
| collection | OXFORD |
| description | This paper argues that the prevalence of compensation systems which reward winners without explicitly identifying losers can be rationalized by workers' concern for relative payo¤s. If the workers' participation constraints are binding, the …rm must compensate its employees for the disutility that they may derive from low status. It follows that pro…t-maximizing employers may be particularly reluctant to penalize or give poor performance evaluation to employees. The theory also sheds light on many other puzzling features of incentive schemes in practice, such as small salary premia, rat races, job title proliferation, the gender wage gap, the gender/happiness paradox and the widespread use of tournaments as a sorting device. |
| first_indexed | 2024-03-07T05:41:21Z |
| format | Working paper |
| id | oxford-uuid:e5acfaf3-52ac-4f9e-a29a-66a83c01e6a2 |
| institution | University of Oxford |
| language | English |
| last_indexed | 2024-03-07T05:41:21Z |
| publishDate | 2005 |
| publisher | Department of Economics (University of Oxford) |
| record_format | dspace |
| spelling | oxford-uuid:e5acfaf3-52ac-4f9e-a29a-66a83c01e6a22022-03-27T10:25:42ZInterpersonal Comparison, Status and Ambition in Organisations.Working paperhttp://purl.org/coar/resource_type/c_8042uuid:e5acfaf3-52ac-4f9e-a29a-66a83c01e6a2EnglishOxford University Research Archive - ValetDepartment of Economics (University of Oxford)2005Ederer, FPatacconi, AThis paper argues that the prevalence of compensation systems which reward winners without explicitly identifying losers can be rationalized by workers' concern for relative payo¤s. If the workers' participation constraints are binding, the …rm must compensate its employees for the disutility that they may derive from low status. It follows that pro…t-maximizing employers may be particularly reluctant to penalize or give poor performance evaluation to employees. The theory also sheds light on many other puzzling features of incentive schemes in practice, such as small salary premia, rat races, job title proliferation, the gender wage gap, the gender/happiness paradox and the widespread use of tournaments as a sorting device. |
| spellingShingle | Ederer, F Patacconi, A Interpersonal Comparison, Status and Ambition in Organisations. |
| title | Interpersonal Comparison, Status and Ambition in Organisations. |
| title_full | Interpersonal Comparison, Status and Ambition in Organisations. |
| title_fullStr | Interpersonal Comparison, Status and Ambition in Organisations. |
| title_full_unstemmed | Interpersonal Comparison, Status and Ambition in Organisations. |
| title_short | Interpersonal Comparison, Status and Ambition in Organisations. |
| title_sort | interpersonal comparison status and ambition in organisations |
| work_keys_str_mv | AT edererf interpersonalcomparisonstatusandambitioninorganisations AT patacconia interpersonalcomparisonstatusandambitioninorganisations |