Open AccessPRIZES VERSUS WAGES WITH ENVY AND PRIDE *
Author(s) -
DUBEY PRADEEP,
GEANAKOPLOS JOHN,
HAIMANKO ORI
Publication year - 2013
Publication title -
the japanese economic review
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.205
H-Index - 28
eISSN - 1468-5876
pISSN - 1352-4739
DOI - 10.1111/j.1468-5876.2012.00564.x
Subject(s) - pride , economics , microeconomics , labour economics , law , political science
We show that if agents are risk‐neutral, prizes outperform wages if and only if there is sufficient pride and envy relative to the noisiness of performance. If agents are risk‐averse, prizes are a necessary supplement to wages (as bonuses).