Unequal pay, fairness concerns, and effort choice

2016 ◽  
Author(s):  
Nick Zubanov
Keyword(s):  
Effort Choice ◽  
Fairness Concerns

scholarly journals A Building-Material Supply Chain Sustainable Operations under Fairness Concerns and Reference Price Benefits

Complexity ◽  
2021 ◽  
Vol 2021 ◽  
pp. 1-14
Author(s):  
Huimin Xiao ◽  
Youlei Xu ◽  
Shiwei Li
Keyword(s):  
Supply Chain ◽  
Building Material ◽  
Cost Sharing ◽  
Reference Price ◽  
Dynamic Models ◽  
Stackelberg Game ◽  
Noncooperative Game ◽  
Sustainable Operations ◽  
Effort Level ◽  
Fairness Concerns

This paper incorporates fairness concerns and consumer reference price effects into a two-echelon building-material closed-loop supply chain consisting of a manufacturer and a retailer. By establishing four differential game models, we investigate the sustainable operations and cooperation of this supply chain. The four game models are a Nash noncooperative game, Stackelberg game with cost sharing, Stackelberg game with fairness concerns and cost sharing, and centralized decision model. By using dynamic models and optimal control theory, we obtain the two members’ optimal equilibrium strategies in the supply chain. Analytical results show that the consumer reference price effect has a positive impact on the manufacturer’s effort level, retailer’s publicity level, and product brand goodwill, which can improve the supply chain performance. The retailer’s partial commitment to cost sharing can enhance the production enthusiasm of the manufacturer, improve the brand reputation of the product, and enhance the two members’ individual profitability. The distributional fairness concerns of the manufacturer not only prevent the manufacturer and retailer from achieving Pareto improvement but also lead to the decline of the manufacturer’s effort level and profitability. The research conclusions of this paper can provide some insights into the cooperation and sustainable development of the supply chain.

Procedural fairness concerns in supply chain with retailer promotional effort

2018 ◽  
Vol 13 (2) ◽  
pp. 302-330 ◽  
Author(s):  
Tengfei Nie ◽  
Hualin Liu ◽  
Yilun Dong ◽  
Shaofu Du
Keyword(s):  
Supply Chain ◽  
Stackelberg Game ◽  
Wholesale Price ◽  
Procedural Fairness ◽  
Content Type ◽  
Promotional Effort ◽  
Fair Process ◽  
Slotting Allowances ◽  
Fairness Concerns ◽  
Distributional Fairness

Purpose The existing literature has a lack of modeling of procedural fairness concerns in the supply chain level. This paper aims to investigate how procedural fairness concerns affect channel decisions, performance and coordination. Design/methodology/approach This paper considers a supply chain consisting of one supplier and one retailer who have procedural fairness concerns in a classic Stackelberg game setting. The model is set in sales promotional environment. According to the existing literature, engagement is used to depict fair process. Some findings are made through analyzing respective decisions of the supplier and the retailer under the influence of procedural fairness concerns. Findings The results show that the channel efficiency can be improved when the retailer exhibits procedural fairness concerns, but if the aversion to unfair process exceeds a certain threshold, the retailer cannot benefit from it. Besides, the retailer profits more when he cares about distributional fairness, although the whole channel surplus can be improved by procedural fairness concerns. Originality/value This is the first paper to study the influences of procedural fairness concerns on supply chain decisions and channel performance. Finally, a mechanism combining a wholesale price contract with slotting allowances is proposed to coordinate the supply chain.

scholarly journals A Behavioral Account of the Labor Market: The Role of Fairness Concerns

2009 ◽  
Vol 1 (1) ◽  
pp. 355-384 ◽  
Author(s):  
Ernst Fehr ◽  
Lorenz Goette ◽  
Christian Zehnder
Keyword(s):  
Labor Market ◽  
Fairness Concerns

The Lessons of Human Resource in The Theory of Constraints

2019 ◽  
pp. 121-135
Author(s):  
Brian J. Galli
Keyword(s):  
Resource Management ◽  
Human Resource Management ◽  
Human Resource ◽  
Labor Relations ◽  
Health And Safety ◽  
Theory Of Constraints ◽  
The Third ◽  
Fairness Concerns

This article describes how human resource management is a field encompassing the interactions between people working within an organization. This area incorporates the process of acquiring, training, appraising, and compensating employees as well as attending to their labor relations, health and safety, and fairness concerns. In this article, the roles of human resource management and how they impact the overall business are discussed in three sections. The first section uses Eli Goldratt's The Goal as a template to discuss the functions of human resource. The second section discusses how technology impacts human resource management. Lastly, the third section discusses human resource management's ability to create continuous improvements and increase overall quality.

The Behavioral Promise and Pitfalls in Compensating Store Managers

2020 ◽  
Vol 66 (10) ◽  
pp. 4899-4919
Author(s):  
Shan Li ◽  
Kay-Yut Chen ◽  
Ying Rong
Keyword(s):  
Operations Management ◽  
Profit Sharing ◽  
Compensation Contracts ◽  
Effort Level ◽  
Store Manager ◽  
Compensation Systems ◽  
Fairness Concerns ◽  
Fixed Wage ◽  
Performance Based Compensation ◽  
New Formulation

Compensation systems have rapidly been shifting away from a fixed wage contractual payment basis. Many companies today are creating incentive compensation contracts to reward hard-working employees for jobs done well. Profit sharing (“sharing compensation contract”) and target with bonus (“target compensation contract”) are two common performance-based compensation contracts prevalent in business. We theoretically and behaviorally study the sharing and target compensation contracts in an operational context where a firm sets the parameters of the compensation contracts and a store manager, after observing the compensation contract offered to him, chooses his effort level (unobservable by the firm) and makes ordering decisions for the store. Our experimental data suggest systematic deviations from the theoretical benchmark and reveal behavioral promise and pitfalls under the two compensation contracts. In particular, the store manager is more willing to exert high effort under the target contract all else being equal. However, the store manager is also more likely to punish the firm for perceived “unfair” offers by submitting an extremely low order quantity. We find that bounded rationality plays an important role in driving a higher effort rate under the target contract than the sharing contract. We introduce a new formulation of the fairness concerns, which is referred to as by-state fairness, where individuals, rather than considering whether the expected profits received are fair, consider the fairness in the potential realized outcomes. This new formulation explains why managers are more likely to order very little to punish the firm under the target contract. In addition, we conduct validation experiments to verify our behavioral explanation. This paper was accepted by Jayashankar Swaminathan, operations management.

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