The organizational goal and work effort: an efficiency wage model

This paper sets up an efficiency wage model which combines goal-attainment theory and the expectancy-valence approach. Taking account of the psychological work motivation, we find that the aspiration for goal attainment may be a substitute for unemployment as an instigator of work motivation in full employment. In addition, since raising the firm’s goal has a diverse impact on the high and low need-for-achievement workers, a higher goal-setting does not appear capable of increasing worker effort within firms. This finding reconciles the conflicting experimental results in industrial psychology literature.

Is the Efficiency Wage Efficient when Workers Decide on the Working Time?

There is a body of literature that argues that workers' productivity is significantly influenced by their hours of work. This paper attempts to set up a shirking model of efficiency wages with endogenous working time to investigate how the endogenous working time decision critically influences work effort and undermines the efficacy of efficiency wages. We believe such a model might conceivably support the empirical finding that there exists a possibly perverse relationship between worker's effort and wages. Received July 10, 2001; revised version received March 21, 2002 Published online: November 11, 2002