Teams often suffer from a free rider problem with respect to individual effort. That putting teams into competition with each other can mitigate this problem is an important recent insight. However, we know little about how inequality between teams might influence this beneficial effect from competition. We address this question with an experiment. The efforts of individuals in the poor team are affected. There is evidence that they respond to moderate inequality ‘doggedly’, by expending more effort. But, when inequality is high, they become ‘disengaged’ and expend no more effort than when there is no competition.
|Publication status||Unpublished - 2014|