Social Interaction, Co-Worker Altruism, and Incentives
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. We discuss some empirical evidence supporting these predictions.
|altruism, co-worker satisfaction, incentive contracts, social interaction|
|Economics of Contract Law (jel D86), Contracts: Specific Human Capital, Matching Models, Efficiency Wage Models, and Internal Labor Markets (jel J41), Personnel Economics: General (jel M50)|
|Tinbergen Institute Discussion Paper Series|
|Discussion paper / Tinbergen Institute|
Dur, A.J, & Sol, J. (2008). Social Interaction, Co-Worker Altruism, and Incentives (No. TI 2008-094/1). Discussion paper / Tinbergen Institute. Tinbergen Institute. Retrieved from http://hdl.handle.net/1765/14047