Co-Worker Altruism and Unemployment

Authors

Jorge Vásquez, Wesleyan UniversityFollow
Marek Weretka, University of Wisconsin-Madison

Document Type

Article

Publication Date

11-2021

Publication Title

Games and Economic Behavior

Abstract

It is well-known that social relationships and altruism among workers foster cooperation in the workplace and, therefore, may have beneficial effects for firms. Yet it is unclear how and to what extent co-worker altruism impacts labor market outcomes. In this paper, we find that, although co-worker altruism may be seamless in good times, it may impact the functioning of labor markets during bad times. Specifically, co-worker altruism may potentially lead to wage rigidity and involuntary unemployment in economic downturns. These results seem to be consistent with recent empirical findings.

Keywords

Non-paternalistic altruism, wage rigidity, involuntary unemployment

Volume

130

First Page

224

Last Page

239

DOI

10.1016/j.geb.2021.08.006

Comments

Peer reviewed accepted manuscript.

Recommended Citation

Vásquez, Jorge and Weretka, Marek, "Co-Worker Altruism and Unemployment" (2021). Economics: Faculty Publications, Smith College, Northampton, MA.
https://scholarworks.smith.edu/eco_facpubs/76