Experimental evidence on the role of outside obligations in wage negotiations

B-Tier
Journal: Journal of Economic Behavior and Organization
Year: 2024
Volume: 219
Issue: C
Pages: 528-548

Score contribution per author:

0.670 = (α=2.01 / 3 authors) × 1.0x B-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

We examine how sharing information about outside obligations impacts wage negotiations. We consider an ‘employee’ with an outside obligation, whose performance determines the surplus and an ‘employer’ with the power-to-give, who determines the employee's wage. We find that wage offers increase with obligation amounts when the level of obligation is known. However, the employer simply redistributes surplus from employees with no obligations to those with higher obligations. We find no evidence of gender bias in wage offers, similar to other ultimatum games. Our experiment provides a potential explanation for some of the gender wage gap and shows how seemingly equitable policies may perpetuate inequities among employees.

Technical Details

RePEc Handle
repec:eee:jeborg:v:219:y:2024:i:c:p:528-548
Journal Field
Theory
Author Count
3
Added to Database
2026-01-25