HERO On line Working Paper Series
Selfish Bakers, Caring Nurses? A Model of Work Motivation
() and Kjell Arne Brekke
Abstract: Work contributes to people’s self-image in important ways.
We propose a model in which individuals have a preference for being
important to others. This leads to the following predictions: 1) In fully
competitive markets with performance pay, behavior coincides with the
standard model (bakers). 2) In jobs where e¤ort is not rewarded according
to its social marginal value, behavior is more socially bene…cial than
predicted by the standard model (nurses). 3) Even if unemployment bene…ts
provide full income compensation, many workers’ utility strictly decreases
when losing their job. 4) Similarly, many workers will prefer to work
rather than to live o¤ welfare, even with full income compensation. 5) To
keep shirkers out of the public sector, nurses’wages must be strictly lower
than private sector income. At this wage level, however, the public sector
will be too small. 6) It is possible to attract motivated workers to the
public sector, without simultaneously attracting shirkers, through capital
input improving nurses’opportunity to do a good job.
Keywords: Homo Oeconomicus; Work Motivation; Labour Market; (follow links to similar papers)
JEL-Codes: I00; J00; (follow links to similar papers)
31 pages, June 2, 2009
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