When to Pay More: Incentives, Culture and Status in Principal‐ Agent Interactions

Dessi, Roberta and Miquel-Florensa, Josepa (2013) When to Pay More: Incentives, Culture and Status in Principal‐ Agent Interactions. TSE Working Paper, n. 13-413

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Official URL: http://tse-fr.eu/pub/27275

Abstract

We study the role of status in an experimental Principal-Agent game.Status is awarded to subjects based on either talent or luck. In each randomly matched principal-agent pair, the principal chooses the agent's
status-contingent piece rate for a task in which talent matters for performance (an IQ test). We perform the experiment in Cambridge (UK) and
in HCMV (Vietnam). We find that in Cambridge piece rate others are significantly higher for high-status agents (only) when status signals talent.
However, these higher offers are not payoff-maximizing for the principals.In contrast, Vietnam piece rate offers are significantly higher for high-status
agents (only) when status is determined by luck. We explore possible explanations, and the implications for status and incentives.

Item Type: Monograph (Working Paper)
Language: English
Date: May 2013
Uncontrolled Keywords: incentives, status, identity, piece rate, principal-agent, signaling, culture
Subjects: B- ECONOMIE ET FINANCE
Divisions: TSE-R (Toulouse)
Site: UT1
Date Deposited: 09 Jul 2014 17:36
Last Modified: 07 Mar 2018 13:22
OAI ID: oai:tse-fr.eu:27275
URI: http://publications.ut-capitole.fr/id/eprint/15657

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