TY  - RPRT
        AU  - Dur, Robert
AU  - Tichem, Jan
        TI  - Altruism and Relational Incentives in the Workplace
        PY  - 2013/Apr/
        PB  - Institute of Labor Economics (IZA)
        CY  - Bonn
        T2  - IZA Discussion Paper
        IS  - 7363
        UR  - https://www.iza.org/index.php/publications/dp7363
        AB  - This paper studies how altruism between managers and employees affects relational incentive contracts. To this end we develop a simple dynamic principal-agent model where both players may have feelings of altruism or spite toward each other. The con- tract may contain two types of incentives for the agent to work hard: a bonus and a threat of dismissal. We find that altruism undermines the credibility of a threat of dis- missal but strengthens the credibility of a bonus. Among others, these two mechanisms imply that higher altruism sometimes leads to higher bonuses, while lower altruism may increase productivity and players utility in equilibrium.
        KW  - Nash bargaining
KW  - spite
KW  - subjective performance evaluation
KW  - efficiency wages
KW  - incentives
KW  - relational contracts
KW  - altruism
        ER  -