Inflation Concerns and Green Product Consumption: Evidence from a Nationwide Survey and a Framed Field Experiment
Sabrina Jeworrek, Lena Tonzer
IWH Discussion Papers,
No. 10,
2024
Abstract
Promoting green product consumption is one important element in building a sustainable society. Yet green products are usually more costly. In times of high inflation, not only budget constraints but also the fear that prices will continue to rise might dampen green product consumption and, hence, limit the effectiveness of exerted efforts to promote sustainable behaviors. To test this suggestion, we conducted a Germany-wide survey with almost 1,200 respondents, followed by a framed field experiment (N=500) to confirm causality. In the survey, respondents’ stated “green” purchasing behavior is, as to be expected, positively correlated with concerns about climate change. It is also negatively correlated with concerns about future inflation and energy costs, but after controlling for observable characteristics such as income and educational level only the correlation with concerns about future prices remains significant. This result is driven by individuals with below-median environmental attitude. In the framed field experiment, we use the priming method to manipulate the saliency of inflation concerns. Whereas sizably relaxing the budget constraint (i.e., by 50 percent) has no impact on the share of organic products in participants’ baskets, the priming significantly decreases the share of organic products for individuals with below-median environmental attitude, similar to the survey data.
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Behaviour
The maths behind gut decisions First carefully weigh up the costs and benefits and then make a rational...
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"The Good News about Bad News": Information about Past Organisational Failure and its Impact on Worker Productivity
Sabrina Jeworrek, Vanessa Mertins, Michael Vlassopoulos
Abstract
Failure in organisations is a very common phenomenon. Little is known about whether past failure affects workers’ subsequent performance. We conduct a field experiment in which we follow up a failed mail campaign to attract new volunteers with a phone campaign pursuing the same goal. We recruit temporary workers to carry out the phone campaign and randomly assign them to either receive or not receive information about the previous failure and measure their performance. We find that informed workers perform better – in terms of both numbers dialed (about 14% improvement) and completed interviews (about 20% improvement) – regardless of whether they had previously worked on the failed mail campaign. Evidence from a second experiment with student volunteers asked to support a campaign to reduce food waste suggests that the mechanism behind our finding relates to contextual inference: Informing workers/volunteers that they are pursuing a goal that is hard to attain seems to add meaning to the work involved, leading them to exert more effort.
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26.09.2017 • 34/2017
Meaningless Work Threatens Employees’ Job Performance
Employees show a significant decline in exerted effort when they are informed about the futility of a task already done. As the results of an experiment conducted by Sabrina Jeworrek from the Halle Institute for Economic Research (IWH) and co-authors show, meaningless work causes anger and disappointment, and can negatively affect employees' later motivation. However, employees seem to “forgive” their employer for cancelling a project if another and still valid purpose is credibly communicated.
Sabrina Jeworrek
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When the Meaning of Work Has Disappeared: Experimental Evidence on Employees’ Performance and Emotions
Adrian Chadi, Sabrina Jeworrek, Vanessa Mertins
Management Science,
No. 6,
2017
Abstract
This experiment tests for a causal relationship between the meaning of work and employees’ motivation to perform well. The study builds on an existing employer–employee relationship, adding realism to the ongoing research of task meaning. Owing to an unexpected project cancelation, we are able to study how varying the information provided about the meaning of previously conducted work — without the use of deception, but still maintaining a high level of control — affects subsequent performance. We observe a strong decline in exerted effort when we inform workers about the meaninglessness of a job already done. Our data also suggests that providing a supplemental alternative meaning perfectly compensates for this negative performance effect. Individual characteristics such as reciprocal inclinations and trust prompt different reactions. The data also show that the meaning of work affects workers’ emotions, but we cannot establish a clear relationship between emotional responses and performance.
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The Behavioral Impact of Non-Monetary Workplace Characteristics
Sabrina Jeworrek
Schriftenreihe innovative betriebswirtschaftliche Forschung und Praxis,
No. 465,
2016
Abstract
This book investigates the impact of non-monetary workplace characteristics ― i.e. employee voice, task characteristics, and the provision of information ― on workers’ individual decision making and workplace performance. Given the neoclassical assumption of purely self-interested and completely rational utility maximizing individuals, workplace characteristics should be of little interest as long as they are not directly related to payment issues, so that a worker’s utility maximizing effort choice given a fixed wage level remains unaffected. Recent empirical findings, however, suggest that the use of non-monetary incentives might even be the better option to increase work performance. Three out of the four experimental studies covered by this book extend the previous research by providing more reliable insights into field behavior than conventional laboratory experiments. Given e.g. the right to self-determine one’s wage, almost all participants in the laboratory opt for the highest possible wage. Within the context of an inventory taking with 140 assistants, we conducted a natural field experiment and show that most workers ask for rather moderate wages with women being particularly conservative in their demands. Notwithstanding, wage delegation causes workers’ performance to rise and, hence, stresses the relevance of voice at the workplace. Furthermore, we provide evidence that workers also care for the content and the meaningfulness of their tasks. Uselessly exerted effort, for instance, reduces work performance as regards a completely unrelated task in the future. Taken together, the field experimental evidence presented in this book indicates that if employees find a workplace which matches their preferences, it is quite likely to be a beneficial situation not only for the employee but also for the employer. Overall good working conditions can even help workers overlook unequal treatments within the workforce, at least in the short-run and as long as there is a plausible reason for it. An additional laboratory experiment, however, suggests that additional information, e.g. about potential coworkers, might be necessary to make reasonable decisions in accordance with individual preferences.
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International Side-payments to Improve Global Public Good Provision when Transfers are Refinanced through a Tax on Local and Global Externalities
Martin Altemeyer-Bartscher, A. Markandya, Dirk T. G. Rübbelke
International Economic Journal,
No. 1,
2014
Abstract
This paper discusses a tax-transfer scheme that aims to address the under-provision problem associated with the private supply of international public goods and to bring about Pareto optimal allocations internationally. In particular, we consider the example of the global public good ‘climate stabilization’, both in an analytical and a numerical simulation model. The proposed scheme levies Pigouvian taxes globally, while international side-payments are employed in order to provide incentives to individual countries for not taking a free-ride from the international Pigouvian tax scheme. The side-payments, in turn, are financed via environmental taxes. As a distinctive feature, we take into account ancillary benefits that may be associated with local public characteristics of climate policy. We determine the positive impact that ancillary effects may exert on the scope for financing side-payments via environmental taxation. A particular attractive feature of ancillary benefits is that they arise shortly after the implementation of climate policies and therefore yield an almost immediate payback of investments in abatement efforts. Especially in times of high public debt levels, long periods of amortization would tend to reduce political support for investments in climate policy.
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Size and Focus of a Venture Capitalist's Portfolio
Paolo Fulghieri, Merih Sevilir
Review of Financial Studies,
No. 11,
2009
Abstract
We take a portfolio approach to analyze the investment strategy of a venture capitalist (VC) and show that portfolio size and scope affect both the entrepreneurs' and the VC's incentives to exert effort. A small portfolio improves entrepreneurial incentives because it allows the VC to concentrate the limited human capital on a smaller number of startups, adding more value. A large and focused portfolio is beneficial because it allows the VC to reallocate the limited resources and human capital in the case of startup failure and allows the VC to extract greater rents from the entrepreneurs. We show that the VC finds it optimal to limit portfolio size when startups have higher payoff potential - that is, when providing strong entrepreneurial incentives is most valuable. The VC expands portfolio size only when startup fundamentals are more moderate and when he can form a sufficiently focused portfolio. Finally, we show that the VC may find it optimal to engage in portfolio management by divesting some of the startups early since this strategy allows him to extract a greater surplus.
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