It's Not You, it's Me: An Experimental Study of Employers' Wage Setting Behavior

• DOI: 10.2139/ssrn.2317334
• Publication Date: 2013-09-04T15:03:00Z
• Authors: Micaela Kulesz; Dennis Alexis Val...
• Keywords: jel:C9; jel:J3; JEL: J3 - Wages Compensation and Labor Costs: General ; laboratory experiment ; responsibility alleviation ; C9 - Design of Experiments: General ; warm-glow; responsibility alleviation, warm-glow, laboratory experiment; 0502 economics and business; 05 social sciences; JEL: J3 - Wages Compensation and Labor Costs: General; warm-glow; laboratory experiment; C9 - Design of Experiments: General; responsibility alleviation

Using an intergenerational trilateral laboratory gift-exchange game, we investigate how employers' own performance in a real effort task impacts on the wage setting behavior of younger and older employers. We find that the employers' own performance strongly affects wage setting behavior, though we do not find significant differences concerning the employers' or employees' age.