Job Assignment and Fairness Concerns

26 Pages Posted: 17 Sep 2019

See all articles by Katarína Danková

Katarína Danková

University of East Anglia (UEA)

Hodaka Morita

Hitotsubashi University - Institute of Economic Research

Maroš Servátka

Macquarie Graduate School of Management - MGSM Experimental Economics Laboratory

Le Zhang

Macquarie University, Macquarie Business School; Macquarie University - Macquarie Graduate School of Management

Date Written: September 6, 2019

Abstract

How does job assignment affect fairness concerns between coworkers? We experimentally examine agents’ horizontal fairness concerns in a three-person ultimatum game in which all agents are asked to complete a general knowledge quiz before being assigned to a high productivity or low productivity position. Job positions differ in the stakes that are available to be split between the principal and the agent. We disentangle two possible channels through which job assignment impacts fairness concerns, wage differences and the principal’s intentions, by comparing cases in which the job assignment is determined randomly or by the principal. The knowledge quiz signifies the distinction between the two cases as it provides a basis on which the principal can make the assignment decision. We find that the principal’s intentions, combined with the associated wage differences, significantly impact fairness concerns of the agents assigned to the lower productivity position, but wage differences themselves do not. We also find that better-performing agents assigned by the principal to the lower productivity position exhibit significant fairness concerns toward their peers. We discuss managerial implications of our findings.

Keywords: job assignment, fairness concerns, experiment, ultimatum game, wage differences, intentions

JEL Classification: C91, C92, J31, J71, M12

Suggested Citation

Danková, Katarína and Morita, Hodaka and Servátka, Maroš and Zhang, Le, Job Assignment and Fairness Concerns (September 6, 2019). Available at SSRN: https://ssrn.com/abstract=3449092 or http://dx.doi.org/10.2139/ssrn.3449092

Katarína Danková

University of East Anglia (UEA) ( email )

Norwich Research Park
Norwich, Norfolk NR4 7TJ
United Kingdom

Hodaka Morita

Hitotsubashi University - Institute of Economic Research ( email )

2-1 Naka Kunitachi-shi
Tokyo 186-8306
Japan

Maroš Servátka (Contact Author)

Macquarie Graduate School of Management - MGSM Experimental Economics Laboratory ( email )

Sydney
Australia

Le Zhang

Macquarie University, Macquarie Business School ( email )

New South Wales 2109
Australia

Macquarie University - Macquarie Graduate School of Management ( email )

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