The Causes and Economic Consequences of Envy Articles uri icon

publication date

  • September 2010

start page

  • 371

end page

  • 386

issue

  • 4

volume

  • 1

International Standard Serial Number (ISSN)

  • 1869-4195

abstract

  • In this lecture I first give an explanation for invidious preferences based on the (evolutionary) competition for resources. Then I show that these preferences have wide ranging and empirically relevant effects on
    labor markets, such as: workplace skill segregation, gradual promotions,
    wage increases that have no relation with productivity and downward
    wage flexibility. I suggest that labor and human resource economics can
    benefit from including envy into the standard set of factors considered
    in their theoretical and empirical models.