@TechReport{iza:izadps:dp5264, author={Huck, Steffen and Kübler, Dorothea and Weibull, Jörgen W.}, title={Social Norms and Economic Incentives in Firms}, year={2010}, month={Oct}, institution={Institute of Labor Economics (IZA)}, address={Bonn}, type={IZA Discussion Paper}, number={5264}, url={https://www.iza.org/publications/dp5264}, abstract={This paper studies the interplay between economic incentives and social norms in firms. We introduce a general framework to model social norms arguing that norms stem from agents’ desire for, or peer pressure towards, social efficiency. In a simple model of team production we examine the interplay of different types of contracts with social norms. We show that one and the same norm can be output-increasing, neutral, or output-decreasing depending on the incentive scheme. We also show how social norms can induce multiplicity of equilibria and how steeper economic incentives can reduce effort.}, keywords={incentives;social norms;contracts}, }