Transaction Frame Determines Preferences: Valuation of Labor by Employee and Contractor.

A major concern in today's economic reality is the extent to which a sharing economy, in comparison with a traditional economy, promotes inequality. In the transformation from a traditional to a sharing economy, wage setting is replaced by contract pricing. The switch to contract trading implies that the party who carries out the labor evaluates the transaction from a buyer's rather than a seller's perspective. Drawing on psychological research on constructed and reference-dependent preferences, we predicted that the net valuation of work would decrease when the regimen involved contract trading. Three experiments (N = 1,105) eliciting work valuation under the two regimens confirmed our prediction, thus pointing to a novel factor that increases inequality.

One-by-One or All-at-Once? Self-Reporting Policies and Dishonesty.

Organizational monitoring relies frequently on self-reports (e.g., work hours, progress reports, travel expenses). A "one-by-one" policy requires employees to submit a series of reports (e.g., daily or itemized reports). An "all-at-once" policy requires an overall report (e.g., an annual or an overview report). Both policies use people's self-reports to determine their pay, and both allow people to inflate their reports to get higher incentives, that is, to cheat. Objectively, people can cheat to the same extent under both reporting policies. However, the two policies differ in that the segmented one-by-one policy signals closer monitoring than the all-at-once policy. We suggest here that lie aversion may have a paradoxical effect on closer monitoring and lead people to cheat more. Specifically, reporting a series of segmented units of performance (allowing small lies) should lead to more cheating than a one-shot report of overall performance (that require one larger lie). Two surveys indicated that while people perceive the all-at-once policy as more trusting, they still expected people would be equally likely to cheat in both policies. An experiment tested the effects of the two reporting policies on cheating. The findings showed that contrary to the participants' intuition, but in line with research on lie aversion, the one-by-one policy resulted in more cheating than the all-at-once policy. Implications for future research and organization policy are discussed.

Winning a competition predicts dishonest behavior.

Winning a competition engenders subsequent unrelated unethical behavior. Five studies reveal that after a competition has taken place winners behave more dishonestly than competition losers. Studies 1 and 2 demonstrate that winning a competition increases the likelihood of winners to steal money from their counterparts in a subsequent unrelated task. Studies 3a and 3b demonstrate that the effect holds only when winning means performing better than others (i.e., determined in reference to others) but not when success is determined by chance or in reference to a personal goal. Finally, study 4 demonstrates that a possible mechanism underlying the effect is an enhanced sense of entitlement among competition winners.