The Currency of Reciprocity: Gift Exchange in the Workplace

Kube, Sebastian; Maréchal, Michel André; Puppe, Clemens

doi:10.1257/aer.102.4.1644

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American Economic Review: Vol. 102 No. 4 (June 2012)

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The Currency of Reciprocity: Gift Exchange in the Workplace

Article Citation

Kube, Sebastian, Michel André Maréchal, and Clemens Puppe. 2012. "The Currency of Reciprocity: Gift Exchange in the Workplace." American Economic Review, 102(4): 1644-62.

DOI: 10.1257/aer.102.4.1644

Abstract

What determines reciprocity in employment relations? We conducted a controlled field experiment to measure the extent to which monetary and nonmonetary gifts affect workers' performance. We find that nonmonetary gifts have a much stronger impact than monetary gifts of equivalent value. We also observe that when workers are offered the choice, they prefer receiving money, but reciprocate as if they received a nonmonetary gift. This result is consistent with the common saying, "it's the thought that counts." We underline this point by showing that monetary gifts can effectively trigger reciprocity if the employer invests more time and effort into the gift's presentation.

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Authors

Kube, Sebastian (U Bonn)
Maréchal, Michel André (U Zurich)
Puppe, Clemens (Karlsruhe Institute of Technology)

JEL Classifications

D64: Altruism
J33: Compensation Packages; Payment Methods
J53: Labor-Management Relations; Industrial Jurisprudence