Stress and Incentives at work

Elena Cottini, paolo ghinetti, elisabetta iossa, pierluigi sacco

Research output: Contribution to journalArticlepeer-review


An extensive medical and occupational-health literature finds that an imbalance between effort and reward is an important stressor which produces serious health consequences. We incorporate these effects in a simple agency model with moral hazard and limitecl liability, and study their impact on the agent's effort and utility, assuming that agents differ in their stress susceptibility. We test our predictions using the 2015 wave of the European Working Condition Survey. We find that individuals who are more susceptible to stress work harder and have lower subjective well-being.
Original languageEnglish
Pages (from-to)325-345
Number of pages21
JournalOxford Economic Papers
Publication statusPublished - 2022


  • incentives
  • stress


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