Gordon Campbell | Parliament TV | Parliament Today | News Video | Crime | Employers | Housing | Immigration | Legal | Local Govt. | Maori | Welfare | Unions | Youth | Search

 

University economics team studying workers’ comparing wages

University of Canterbury economics team studying workers’ comparing wages

August 31, 2014

A University of Canterbury economics research team is looking at fairness of the job assignments and whether workers are sensitive to the wages of their co-workers.

The research team, headed by Associate Professor Maro¹ Servátka, is investigating if workers react to the employers’ decisions about job allocations and if employers consider the importance of the job assignment process and reduce wage differences.

``It has been shown that workers choose not to produce their full effort when wages are intentionally low but they work harder when external processes determine their wages,’’ Associate Professor Servátka says.

The research has implications for firms’ wage policy decisions about wage secrecy and offering similar wages in order to avoid diminished performance of a company or organisation.

The project is being conducted at the university’s New Zealand Experimental Economics Laboratory.

A total of 288 students participated in the study, 96 of them were in a role of an employer and 192 in a role of a worker.

The research team analysed their actual decisions in a simulated labour market. All participants were financially motivated. The more profit they made in the market, the more cash they got paid for their participation in the experiment. This way the researchers saw how people realistically behave when facing various fairness scenarios, making their results of interest to existing real world employers.

Postgraduate student Katarina Danková says people are driven by social comparison and workers look at their co-workers who are in similar circumstances to evaluate their outcomes and judge whether they have been treated fairly.

``Workers often compare their wages within their own firm. Social comparisons may affect a worker’s attitude toward an employer or a firm, and thus in turn affect their performance. If workers feel that the employer is discriminating, they can withhold all their effort which can lead to a lack of cooperation and lower output for the firm,’’ Danková says.

``Firms often pay workers the same wage for a given job, regardless of workers’ productivity levels. If workers are paid below what they think they deserve, which depends on their co-workers’ wages, they might retaliate by reducing their performance.

``Understanding the impacts of reducing wages is important for employers since it can be profit maximising for firms to pay workers similar wages.’’


ends

© Scoop Media

 
 
 
Parliament Headlines | Politics Headlines | Regional Headlines

PM's Speech: NZ Moves To Red


Nine COVID-19 cases reported yesterday in the Nelson/Marlborough region have now been confirmed as the Omicron variant, and a further case from the same household was confirmed late yesterday....
More>>

ALSO:


Gordon Campbell: On Responding To The Need In Tonga


The power of the Tonga eruption (and the size of the aid response being mounted) have been sobering indications of the scale of this disaster. The financial impact is certain to exceed the damage done by Cyclone Harold two years ago, which was estimated at the time to cost $US111 million via its effects on crops, housing and tourism facilities. This time, the tsunami damage, volcanic ash, sulphur dioxide contamination and villager relocation expenses are likely to cost considerably more to meet...
More>>



 
 



Science Media Centre: Omicron Outbreak Would Move The Country To Red - Expert Reaction

The Prime Minister has announced if Omicron cases spread into the community, the country will move to the traffic light system's Red setting within 48 hours. Jacinda Ardern also mentioned there will be changes to the country's testing regime, with more use of Rapid Antigen Tests... More>>


Government: New Zealand Prepared To Send Support To Tonga

New Zealand is ready to assist Tonga in its recovery from Saturday night’s undersea eruption and tsunami, Foreign Affairs Minister Nanaia Mahuta and Defence Minister Peeni Henare said today... More>>


Ministry of Health: COVID-19 Immunisation Starts For 5 To 11-year-old Tāmariki

More than 120,000 doses of the child (paediatric) Pfizer vaccine have been delivered to over 500 vaccination sites around New Zealand as health providers prepare to start immunising 5 to 11-year-olds tamariki from today, 17 January... More>>



Statistics: Departures Lift Border Crossing Numbers

The number of people crossing New Zealand’s border went up in November 2021, mostly due to an increase in departures, Stats NZ said today. There were 28,700 border crossings in November 2021, made up of 12,300 arrivals and 16,400 departures... More>>


Financial Services Federation: Open Letter To Government From Non-bank Lenders: The Path Forward On CCCFA Changes
Responsible lenders are not interested in telling the Government “I told you so” when it comes to unintended consequences of changes to lending laws that are now causing grief for everyday Kiwis seeking finance... More>>

CTU: Too Many Kiwi Workers Financially Vulnerable As Omicron Looms
With New Zealand on the precipice of an Omicron outbreak and the economic upheaval that comes with it, the CTU’s annual Mood of the Workforce Survey shows the vast majority of kiwi workers do not have the financial resources to survive a period of unemployment... More>>

 
 
 
 
 
 

LATEST HEADLINES

  • PARLIAMENT
  • POLITICS
  • REGIONAL
 
 

InfoPages News Channels