Putting Reciprocity to Work - Positive Versus Negative Responses in the Field
University of St. Gallen Economics Discussion Paper No. 2006-27
20 Pages Posted: 15 Nov 2006
Date Written: November 2006
We study the role of reciprocity in a labor market field experiment. In a recent paper, Gneezy and List (2006) investigate the impact of gift exchange in this context and find that it has only a transient effect on long run outcomes. Extending their work to examine both positive and negative reciprocity, we find consonant evidence in the positive reciprocity condition: the gift does not work well in the long run (if at all). Yet, in the negative reciprocity treatment we observe much stronger effects: a wage reduction has a significant and lasting negative impact on efforts. Together, these results highlight the asymmetry of positive and negative reciprocity that exists in the field, and provide an indication of the relative importance of each in the long run.
Keywords: reciprocity, gift exchange, field experiment
JEL Classification: C93, J30
Suggested Citation: Suggested Citation