textabstractA worker's utility may increase in his own income, but envy can make his utility decline with his employer's income. Such behavior may call for high-powered incentives, so that increased effort by the worker little increases the income of his employer. This paper employs a principal-agent model to study optimal incentive contracts for envious workers under various assumptions about the object and generality of envy. Envy amplifies the effect of incentives on effort and, therefore, increases optimal incentive pay. Moreover, envy can make profit-sharing optimal, even when the worker's effort is fully contractible. We discuss several applications of our theoretical work. For example, envy can explain why lower-level workers are awa...
While most market transactions are subject to strong incentives, transactions within firms are often...
While most market transactions are subject to strong incentives, transactions within firms are often...
We study optimal contracts when employees are averse to inequity as modelled by Fehr and Schmidt (19...
A worker's utility may increase with his income, but envy can make his utility decline with his empl...
We are studying in this paper an interplay between workers in organizations under the assumption tha...
We are studying in this article an interplay between workers in organizations under the assumption t...
While most market transactions are subject to strong incentives, transactions within firms are often...
While most market transactions are subject to strong incentives, transactions within firms are often...
I analyze optimal incentive pay for envious workers when performance is non-verifiable. Incentives a...
I study how envy in the workplace affects the optimal employment contract when employees differ in t...
In a simple agency model of the labor market, we examine how fairness concerns affect the structure ...
I study how envy in the workplace affects the optimal employment contract when employees differ in t...
The paper analyzes an ex-ante contracting with limited liability constraints when agents feel enviou...
While most market transactions are subject to strong incentives, transactions within firms are often...
While most market transactions are subject to strong incentives, transactions within firms are often...
While most market transactions are subject to strong incentives, transactions within firms are often...
While most market transactions are subject to strong incentives, transactions within firms are often...
We study optimal contracts when employees are averse to inequity as modelled by Fehr and Schmidt (19...
A worker's utility may increase with his income, but envy can make his utility decline with his empl...
We are studying in this paper an interplay between workers in organizations under the assumption tha...
We are studying in this article an interplay between workers in organizations under the assumption t...
While most market transactions are subject to strong incentives, transactions within firms are often...
While most market transactions are subject to strong incentives, transactions within firms are often...
I analyze optimal incentive pay for envious workers when performance is non-verifiable. Incentives a...
I study how envy in the workplace affects the optimal employment contract when employees differ in t...
In a simple agency model of the labor market, we examine how fairness concerns affect the structure ...
I study how envy in the workplace affects the optimal employment contract when employees differ in t...
The paper analyzes an ex-ante contracting with limited liability constraints when agents feel enviou...
While most market transactions are subject to strong incentives, transactions within firms are often...
While most market transactions are subject to strong incentives, transactions within firms are often...
While most market transactions are subject to strong incentives, transactions within firms are often...
While most market transactions are subject to strong incentives, transactions within firms are often...
We study optimal contracts when employees are averse to inequity as modelled by Fehr and Schmidt (19...