What determines reciprocity in employment relations? We conducted a controlled field experiment to measure the extent to which monetary and non-monetary gifts affect workers' performance. We find that non-monetary gifts have a much stronger impact than monetary gifts of equivalent value. We also observe that when workers are offered the choice, they prefer receiving money but reciprocate as if they received a non-monetary gift. This result is consistent with the common saying, "it's the thought that counts". We underline this point by showing that also monetary gifts can effectively trigger reciprocity if the employer invests more time and effort into the gift's presentation.

Employment contracts are often incomplete, leaving many responsibilities subject to workers' discretion. High work morale is therefore essential for sustaining voluntary cooperation and high productivity in firms. We conducted a field experiment to test whether workers reciprocate wage cuts and raises with low or high work productivity. Wage cuts had a detrimental and persistent impact on productivity, reducing average output by more than 20 percent. An equivalent wage increase, however, did not result in any productivity gains. The results from an additional control experiment with high monetary performance incentives demonstrate that workers could still produce substantially more output, leaving enough room for positive reactions. Altogether, these results provide evidence consistent with a model of reciprocity, as opposed to inequality aversion.JEL classification: C93, J30.

The chapter surveys the recent and fast‐growing literature on the aggregation of logically interrelated propositions, following List and Pettit's formalization of the “doctrinal paradox”. The classical preference aggregation problem is a special case in which propositions take the form of binary preference judgments (“alternative x is better than alternative y”). The first part of the chapter focuses on aggregation methods that satisfy an Arrowian independence condition (“propositionwise aggregation”). In the independent case, the literature has produced a number of general characterization results that precisely demarcate the circumstances in which satisfactory aggregation is possible from those in which it is not Arrow's impossibility theorem and Gibbards oligarchy theorem are special cases of these results. The independence condition is, however, not uncontroversial and the second part of the chapter considers various relaxations of it. Judgment aggregation is still a very active field and the chapter concludes with an outlook on what we believe are important topics for future research.

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