Unfair pay and health

Armin Falk, Fabian Kosse, Ingo Menrath, Pablo E. Verde, Johannes Siegrist

12 Citations (Scopus)


This paper investigates physiological responses to perceptions of unfair pay.We use an integrated approach that exploits complementarities between controlled laboratory and representative panel data. In a simple principal-agent experiment, agents produce revenue by working on a tedious task. Principals decide how this revenue is allocated between themselves and their agents. Throughout the experiment we record agents' heart rate variability, which is an indicator of stress-related impaired cardiac autonomic control and which has been shown to predict coronary heart disease in the long run. Our findings establish a link between unfair payment and heart rate variability. Building on these findings, we further test for potential adverse health effects of unfair pay using observational data from a large representative panel data set. Complementary to our experimental findings we show a strong and significant negative association between unfair pay and health outcomes, in particular cardiovascular health.

Original languageEnglish
JournalManagement Science
Issue number4
Pages (from-to)1477-1488
Number of pages12
Publication statusPublished - 04.2018

Research Areas and Centers

  • Academic Focus: Center for Brain, Behavior and Metabolism (CBBM)


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