Honekamp, Ivonne (2007): High Wages - An instrument inducing workers to work more?
Download (96kB) | Preview
Wages and their effect on labour supply are not only an important subject for labour economists who aim at measuring substitution and income effects. Additionally, the government is interested in the impact of policy changes on the labour market and companies would like to know if it is possible to increase labour supply and especially productivity by increasing the wage rate. This paper introduces a dynamic version of the traditional model of labour supply and presents model extensions and the underlying behavioural assumptions arising from empirical findings, psychology and neuroscience. It evaluates findings and behavioural assumptions derived so far. None of the contributions investigated in this work is entirely free from criticism. The problem of analysing a comprehensive model of labour supply on the one hand, is the scarcity of suitable subjects to investigate and on the other hand, the individuality of each subject observed. With this work a critical analysis of existing research on labour supply decisions is provided. This shall contribute to motivate and ease future research in this area which has to take these problems into account.
|Item Type:||MPRA Paper|
|Original Title:||High Wages - An instrument inducing workers to work more?|
|Keywords:||high wages; analysis; labour supply decision; labour supply model; intertemporal labour supply|
|Subjects:||J - Labor and Demographic Economics > J3 - Wages, Compensation, and Labor Costs > J31 - Wage Level and Structure; Wage Differentials
J - Labor and Demographic Economics > J2 - Demand and Supply of Labor > J22 - Time Allocation and Labor Supply
J - Labor and Demographic Economics > J3 - Wages, Compensation, and Labor Costs > J33 - Compensation Packages; Payment Methods
|Depositing User:||Ivonne Honekamp|
|Date Deposited:||22. Jun 2009 01:18|
|Last Modified:||12. Feb 2013 13:39|
Becker, G.S. and Stigler, G.J. (1974): “Law Enforcement, Malfeasance, and Compensation of Enforcers”, Journal of Legal Studies, 3, 1-18.
Camerer, C. et al. 1997: “Labor Supply of New York City Cabdrivers: One Day at a Time”, The Quarterly Journal of Economics, 112, 407-441.
Chung-cheng L. (2003): “A backward-bending labor supply curve without an income effect”, Oxford Economic Papers, 55, 336-343.
Dickinson, D.L. (1999): “An Experimental Examination of Labor Supply and Work Intensities”, Journal of Labor Economics, 17 (4), 638-670.
Faber, H.S. (2005): “Is Tomorrow Another Day? The Labor Supply of New York City Cabdrivers”, Journal of Political Economy, 113 (1), 46-82.
Fehr, E. and Goette, L. (2005): “Do Workers Work More when Wages Are High? Evidence from a Randomized Field Experiment”, American Economic Review, 97, 298-317.
Franz, W. (2003): “Arbeitsmarktökonomik”, 5. ed., Springer.
Goette, L. and Huffman, D. (2003): ”Reference-Dependent Preferences and the Allocation of Effort over Time: Evidence from Natural Experiments”, Mimeo. Institute for Empirical Research in Economics, University Zurich.
Goette, L. and Huffman, D. (2005): “Reference-Dependent preferences and the allocation of effort over time: Evidence from natural experiments with bike messengers”. [online]. Available from: http://www.cer.ethz.ch/resec/sgvs/038.pdf. [cited 16. Dec. 2007], Paper presented at the Swiss Society of Economics and Statistics – Annual Meeting 2005.
Goette, L. and Huffman, D. (2006): “Incentives and the Allocation of Effort Over Time: The Joint Role of Affective and Cognitive Decision Making”, IZA Discussion Paper, 2400.
Goette, L., Huffman, D. and Fehr, E. (2003): “Loss Aversion and Labor Supply”, Journal of the European Economic Association, 2 (2-3), 216-228.
Köszegi, B. and Rabin, M. (2004): “A Model of Reference-Dependent Preferences”. Forthcoming, Quarterly Journal of Economics.
Oettinger, G.S. (1997): “Daily Labor Supply of Stadium Vendors: An Empirical Analysis of Participation and Effort Decisions”, Industrial Realations Section Princeton University, Working Paper, 383.
Oettinger, G.S. (1999): “An Emperical Analysis of the Daily Labor Supply of Stadium Vendors”, The Journal of Political Economy, 107 (2), 360-392.
Read, D. and Loewenstein, G. (1996): “Temporal Bracketing of Choice: Discrepancies between Simultaneous and Sequential Coice”, Working Paper, Department of Social and Decision Sciences, Carnegie Mellon University.
Shapiro, C. and Stiglitz, J. (1984): “Equilibrium unemployment as a worker discipline device”, American Economic Review, 74, 433-444.