Domains of reciprocity beyond monetary compensation: How do non-pecuniary factors affect effort and shirking?

Akinori Tomohara,Akihiko Ohno

doi:10.1080/23322039.2016.1178884

Abstract

AbstractThis empirical study examines how sources of reciprocity are related to work motivation by distinguishing positive and negative work attitudes in practical working environments. We move away from the unidimensional perspective of monetary compensation and investigate employees’ reciprocal behaviors, together with non-pecuniary aspects of work relations such as human relationships and company management. The results show that positive reciprocity, represented by effort, is fundamentally distinct from negative reciprocity, represented by shirking, when examining the multi-dimensional sources of reciprocity. Additionally, our analyses reveal that non-pecuniary factors in the working environment have a relatively large degree of association with work motivation, even when compared to monetary compensation. Our results complement those from controlled laboratory experiments.

Highlights

Employee motivation has remained a chief concern of economists ever since the division of labor became a common working practice after the Industrial Revolution
Our analyses reveal that non-pecuniary factors, such as human relationships and company management, in the working environment have a relatively large degree of association with work motivation, even when compared to monetary compensation
In addition to fundamental differences between positive and negative reciprocity, our analyses show that non-pecuniary factors such as human relationships and company management have a relatively large degree of association with work motivation, even when compared to monetary compensation

Summary

Introduction

Employee motivation has remained a chief concern of economists ever since the division of labor became a common working practice after the Industrial Revolution. The efficiency wage theory is an influential approach among the numerous studies on work motivation (Akerlof, 1982; Akerlof & Yellen, 1990; Shapiro & Stiglitz, 1984). There is a positive relationship between wages and work motivation (i.e. a higher wage motivates employees to work hard), but there are a few possible explanations for this relationship. The incentive mechanism of Akerlof’s gift exchange model differs from those of the shirking model of Shapiro and Stiglitz. In the gift exchange model, employees are willing to work hard to express their appreciation of the generosity of their employers, who offer a higher wage than the market-clearing wage

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Results

Conclusion