Relative pay and labor supply

Authors
Publication date 2015
Journal Journal of labor economics
Volume | Issue number 33 | 2
Pages (from-to) 297-315
Organisations
  • Faculty of Economics and Business (FEB) - Amsterdam School of Economics Research Institute (ASE-RI)
Abstract We examine the impact of relative wages on labor supply in a laboratory experiment. We test the hypothesis that, ceteris paribus, making a given wage high (low) relative to other wage levels will lead to an increase (decrease) in labor supply. We find that labor supply does respond significantly to relative pay, and in the expected direction. However, when a strong enough reason for the relative low pay is given, this difference disappears.
Document type Article
Note With supplemental material
Language English
Published at https://doi.org/10.1086/678494
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