Timo Heinrich (Durham University), 4 Dec 2017, 4:30pm, DUBS

Speaker: Timo Heinrich, Durham University 

Title: "Costly information acquisition: The effects of wage inequality" (with Alexander Haering and Sven Horak)

Date & Time: 04th December 2017 (Monday), 4:30-5:45 pm

Venue:  Durham University Business School, room 240



In research and development information is often acquired within organizations. These social settings are usually characterized by wage inequality but it is difficult to study the influence of wages on performance systematically. In this paper we analyze the causal effects of wage inequality on information acquisition performance under controlled conditions that allow us to systematically vary the pay of agents and their peers. Our experimental results reveal that disadvantageous inequality in wages does not have a negative effective on agents’ performance. It can even be more effective in improving performance of agents than a general increase in wages. This effect can be explained by agents’ individual differences in loss aversion.

Last modified: Fri, 17 Nov 2017 10:15:09 GMT