Social Interaction, Co-Worker Altruism, and Incentives
24 Pages Posted: 9 Nov 2009
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Social Interaction, Co-Worker Altruism, and Incentives
Social Interaction, Co-Worker Altruism, and Incentives
Abstract
Social interaction with colleagues is an important job attribute for many workers. To attract and retain workers, managers therefore need to think about how to create and preserve high-quality co-worker relationships. This paper develops a principal-multi-agent model where agents do not only engage in productive activities, but also in social interaction with their colleagues, which in turn creates co-worker altruism. We study how financial incentives for productive activities can improve or damage the work climate. We show that both team incentives and relative incentives can help to create a good work climate.
Keywords: social interaction, altruism, incentive contracts, co-worker satisfaction
JEL Classification: D86, J41, M50
Suggested Citation: Suggested Citation
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