Effort and Comparison Income: Experimental and Survey Evidence

Andrew Clark, David Masclet () and Marie Claire Villeval

CEP Discussion Papers from Centre for Economic Performance, LSE

Abstract: This paper considers the effect of status or relative income on work effort, combining experimental evidence from a gift-exchange game with the analysis of multi-country ISSP survey data. We find a consistent negative effect of others' incomes on individual effort in both datasets. The individual's rank in the income distribution is a stronger determinant of effort than is others' average income, suggesting that comparisons are more ordinal than cardinal. In the experiment, effort is also affected by comparisons over time: those who received higher income offers or enjoyed higher income rank in the past exert lower levels of effort for a given current income and rank.

Keywords: Effort; comparison income; rank; peak-end; experiments (search for similar items in EconPapers)
JEL-codes: A13 C92 D63 J33 M54 (search for similar items in EconPapers)
Date: 2008-08
New Economics Papers: this item is included in nep-cbe and nep-exp
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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https://cep.lse.ac.uk/pubs/download/dp0886.pdf (application/pdf)

Related works:
Journal Article: Effort and Comparison Income: Experimental and Survey Evidence (2010)
Working Paper: Effort and comparison income: experimental and survey evidence (2010)
Working Paper: Effort and comparison income: experimental and survey evidence (2010)
Working Paper: Effort and comparison income: experimental and survey evidence (2008)
Working Paper: Effort and Comparison Income: Experimental and Survey Evidence (2006)
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Persistent link: https://EconPapers.repec.org/RePEc:cep:cepdps:dp0886

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