Do Labour Market Conditions Affect Gift Exchange? Some Experimental Evidence

Brandts, Jordi; Charness, Gary

doi:10.2139/ssrn.245348

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Do Labour Market Conditions Affect Gift Exchange? Some Experimental Evidence

Universitat Pompeu Fabra Working Paper No. 491

46 Pages Posted: 4 Nov 2000

See all articles by Jordi Brandts

Jordi Brandts

Instituto de Analisis Economico (CSIC) Barcelona

Gary Charness

University of California, Santa Barbara (UCSB) - Department of Economics

Date Written: July 8, 2003

Abstract

We study how two dimensions of market conditions affect behavior in experimental gift-exchange markets with repeated interaction. First, we consider the impact of competitive imbalance, by varying whether there is an excess supply of firms or an excess supply of workers in the market. Second, we impose a minimum wage in the market with an excess supply of workers, and study the overall effect on wages and productivity. Perhaps surprisingly, the state of competition does not appear to have strong effects in our data; however, there is some evidence of lower productivity when a minimum wage is imposed.

Keywords: Experiment, Unbalanced Markets, Cooperation, Gift-Exchange

JEL Classification: A13, C91,C92, D43, J41

Suggested Citation: Suggested Citation

Brandts, Jordi and Charness, Gary, Do Labour Market Conditions Affect Gift Exchange? Some Experimental Evidence (July 8, 2003). Universitat Pompeu Fabra Working Paper No. 491, Available at SSRN: https://ssrn.com/abstract=245348 or http://dx.doi.org/10.2139/ssrn.245348