Journal article
Contracting Benefits of Corporate Giving: An Experimental Investigation
The Accounting review, Vol.86(6), pp.1887-1907
11/01/2011
DOI: 10.2308/accr-10127
Abstract
We use a laboratory experiment to examine whether corporate giving to charity motivates employees. We find a strong altruism effect. Even when employees cannot be remunerated for their actions, employee contributions to employers significantly increase as the level of corporate giving increases. We also find a signaling effect. When employees can be remunerated for their actions, employee contributions initially increase as the level of corporate giving increases. Thus, even though corporate giving to charity decreases the amount that can be shared between employees and employers, employees behave as if more charitable employers will return proportionally more to employees. It is not until relatively high levels of corporate giving that employee contributions to employers eventually decrease. Collectively, our results suggest that corporate giving is an effective lever for motivating employee effort and contributions to organizational endeavors. Corporate giving can increase the efficacy of implicit (relational) contracts and reduce the need for formal accounting-based reward systems and controls.
Details
- Title: Subtitle
- Contracting Benefits of Corporate Giving: An Experimental Investigation
- Creators
- Ramji Balakrishnan - University of IowaGeoffrey B. Sprinkle - Indiana UniversityMichael G. Williamson - Univ Texas Austin, Austin, TX 78712 USA
- Resource Type
- Journal article
- Publication Details
- The Accounting review, Vol.86(6), pp.1887-1907
- Publisher
- Amer Accounting Assoc
- DOI
- 10.2308/accr-10127
- ISSN
- 0001-4826
- eISSN
- 1558-7967
- Number of pages
- 21
- Language
- English
- Date published
- 11/01/2011
- Academic Unit
- Accounting
- Record Identifier
- 9984380430602771
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