@TechReport{iza:izadps:dp4782, author={Dur, Robert and Non, Arjan and Roelfsema, Hein}, title={Reciprocity and Incentive Pay in the Workplace}, year={2010}, month={Feb}, institution={Institute of Labor Economics (IZA)}, address={Bonn}, type={IZA Discussion Paper}, number={4782}, url={https://www.iza.org/publications/dp4782}, abstract={We study optimal incentive contracts for workers who are reciprocal to management attention. When neither worker's effort nor manager's attention can be contracted, a double moral-hazard problem arises, implying that reciprocal workers should be given weak financial incentives. In a multiple-agent setting, this problem can be resolved using promotion incentives. We empirically examine these predictions using data from the German Socio-Economic Panel. We find that workers who are more reciprocal are significantly more likely to receive promotion incentives, while there is no such relation for individual bonus pay. }, keywords={double moral hazard;GSOEP;social exchange;reciprocity;incentive contracts}, }