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July 30 is International Day of Friendship, based on the recognition of the relevance and importance of friendship as a noble and valuable sentiment around the world.
How do social interactions affect the labor market?
Thomas Cornelissen writes, “Evidence suggests that peer pressure affects productivity and is an important reason why workers’ wages and productivity depend on their co-workers’ productivity…Peer effects due to knowledge spillover seem to be relevant in specific situations, such as when newly trained and untrained workers interact, in collaborative team settings or between senior and junior workers. In such instances, firms should encourage social interaction.”
Joseph Price writes, “Workers’ skills are multidimensional, and one of the skills that may contribute to team production is the ability to bring out the best in others.” Most peer effects literature assumes that workers with the highest own productivity are the ones who bring out the best in others. However a study of NBA players found a slight negative correlation between own productivity and the ability to increase the productivity of others. In addition, it is apparent that players who have a selfish style of play boost their own performance measures at the expense of their team’s success.
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