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Free Riding, Democracy and Sacrifice in the Workplace:Evidence from a Real Effort Experiment

Author

Listed:
  • Kenju Kamei

    (Faculty of Economics, Keio University)

  • Katy Tabero

    (Durham University Business School)

Abstract

Teams are increasingly popular decision-making and work units in firms. This paper uses a novel real effort experiment to show that (a) some teams in the workplace reduce their members�f�@private benefits to achieve a group optimum in a social dilemma and (b) such endogenous choices by themselves enhance their work productivity (per work time production) ? a phenomenon called the �gdividend of democracy.�h In the experiment, worker subjects are randomly assigned to a team of three, and they then jointly solve a collaborative real effort task under a revenue-sharing rule in their group with two other teams, while each individual worker can privately and independently shirk by playing a Tetris game. Strikingly, teams exhibit significantly higher productivity (per-work-time production) when they can decide whether to reduce the return from shirking by voting than when the policy implementation is randomly decided from above, irrespective of the policy implementation outcome. This means that democratic culture directly affects behavior. On the other hand, the workers under democracy also increase their shirking, presumably due to enhanced fatigue owing to the stronger productivity. Despite this, democracy does not decrease overall production thanks to the enhanced work productivity.

Suggested Citation

  • Kenju Kamei & Katy Tabero, 2023. "Free Riding, Democracy and Sacrifice in the Workplace:Evidence from a Real Effort Experiment," Keio-IES Discussion Paper Series 2023-011, Institute for Economics Studies, Keio University.
    • Handle: RePEc:keo:dpaper:2023-011
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    workplace democracy; moral hazard; experiment; free riding; teamwork;
    All these keywords.

    JEL classification:

    • C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior
    • D02 - Microeconomics - - General - - - Institutions: Design, Formation, Operations, and Impact
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods

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