Please use this form to submit your study for inclusion into our database. It will be checked by a member of the Innovation Growth Lab team, who may be in contact to ask for more information. Your email address * Your name * Title * The name of the study Short summary Effects of relative pay on effort and labour supply are being examined in the context of an Indian manufacturing plant where co-workers' wages are exogenously varied. Results forthcoming. A brief description of the project's goals and its current state Abstract <p>A long tradition in economics and psychology has advanced the notion that individuals care about not only their own pay, but also their pay relative to that of their co-workers. We use a field experiment with Indian manufacturing workers to test whether relative pay comparisons affect effort and labor supply. Workers perform individual production tasks, but are organized into distinct teams - defined by the type of product they produce. We randomize teams to receive either compressed wages (where all workers earn the same random daily wage) or heterogeneous wages (where each team member is paid a different wage according to his baseline productivity level). This enables effort comparisons across workers who receive the same absolute wage, but vary in the wages of their co-workers. In addition, we introduce heterogeneity in the extent to which pay differences across co-workers seem justified.</p> The full abstract of the study, if available Links https://academic.oup.com/qje/article/133/2/611/4430649 Links to any published papers and related discussions Authors * Affiliations Academic and other institutes that the authors of the study are members of Delivery partner Organisations involved in delivering the trial, if appropriate Year Year Year199419951996199719981999200020012002200320042005200620072008200920102011201220132014201520162017201820192020202120222023202420252026 Month MonthJanFebMarAprMayJunJulAugSepOctNovDec Day Day12345678910111213141516171819202122232425262728293031 Journal Journal publishing the study, if available Publication stage * Working Paper Published Ongoing Research Forthcoming Discussion Paper Research theme * Entrepreneurship Innovation Business Growth Country Country or countries where this study took place. Topics What sort of topics does the study cover? Sample attributes Hypotheses / research question Do individuals care about their pay relative to that of their co-workers, in addition to their own pay, and do these relative pay comparisons affect effort and labour supply? Sample Trial population and sample selection Workers were recruited from nearby villages to participate full-time in a low-skilled manufacturing job. At the worksites, workers are organised into teams of three and trained in one of ten tasks, for which production is an individual activity. They first undergo a training period, during which they are paid the same daily wage. Once the training period is over, wages are varied across teams, and in some cases, across workers within a team. This is done by assessing workers' baseline productivity once training is over, and assigning each worker a relative productivity rank within their team. Teams are then randomised into one of four wage treatments. Workers are randomised into jobs at the individual level. Once at the worksite, they are randomised into teams. Randomisation of teams into wage treatments is done at the team level. Number of treatment groups Size of treatment groups Each treatment group is comprised of 100 teams of workers, each team consisting of three workers. Size of control group Unit of analysis Clustered? Yes No Cluster details Trial attributes Treatment description Workers receive a wage treatment based on the random assignment of their team into one of four wage treatments: Each team member is paid according to his baseline productivity, with the wages for the lowest, middle and highest productivity workers being "wage low", "wage medium" and "wage high", respectively, where "wage training" < "wage low" < "wage medium" < "wage high" All team members are paid the same daily wage of "wage low" All team members are paid the same daily wage of "wage medium" All team members are paid the same daily wage of "wage high" Rounds of data collection Baseline data collection and method Among variables included in the baseline: workers' baseline productivity, workers' team assignment, and team treatment assignment. Data collection method and data collected Evaluation Outcome variables <p>Daily production for each worker: Count of the total items produced in a day. Daily attendance of each worker, including time of arrival and departure from worksite. Total labour earnings of each worker: Data from worksite payroll as well as end line survey responses about outside activities on days when workers are absent. Team-level output.</p> Results Intervention costs Not available. Cost benefit ratio Reference Emily Breza, Supreet Kaur, Yogita Shamdasani; The Morale Effects of Pay Inequality, The Quarterly Journal of Economics, Volume 133, Issue 2, 1 May 2018, Pages 611–663 Citation for use in academic references
