May 2004

IZA DP No. 1137: Fairness, Reciprocity, and Wage Rigidity

published in: H. Gintis et al. (eds), Moral Sentiments and Material Interests: The Foundations of Cooperation in Economic Life, Cambridge: MIT Press 2005; P. Diamond & H. Vartianen (eds), Behavioral Economics and Its Applications, Princeton University Press, 2007

This paper contains a review of empirical work related to wage rigidity, where researchers have collected their own data. The work includes field studies, economic experiments, and psychological surveys. Economists have done the field studies and experiments, and management scientists and experimental psychologists have done the surveys. There is a remarkable agreement among the observations of all these investigators.