American Economic Review Vol. 105 No. 5 2015

The Real Effects of Relational Contracts

Steven Blader¹; Claudine Madras Gartenberg¹; Rebecca Henderson²; Andrea Prat³

¹ Department of Management and Organizations, New York University Stern School of Business, 40 West 4th Street, New York, NY 10012 (e-mail: ) · ² Harvard Business School, Soldiers Field, Boston, MA 02163 (e-mail: ) · ³ Columbia Business School, 3022 Broadway, New York, NY 10027 (e-mail: )

Abstract

Does the “soft side” of management matter? Many managers assert that “firm culture” is strongly correlated with productivity, but there are few robust tests of this assertion. In a set of field experiments, we study driver productivity within a large US logistics company that is arguably transitioning from one relational contract to another, while leaving formal practices and incentives unchanged. We find that sites under the new contract are associated with 1/8 percent higher productivity. Our findings suggest that relational contracts have a first-order effect on productivity and that they can be altered over time.

DOI

10.1257/aer.p20151002

Volume

105

Issue

5

Pages

452-456

Language

en

Sources

bibtex:phds-export.bib crossref openalex

Cite

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