University of Hertfordshire

From the same journal

Adaptation towards reference values: A non-linear perspective

Research output: Contribution to journalArticle

  • Yannis Georgellis
  • Andros Gregorioua
  • N. Tsitsianis
View graph of relations
Original languageEnglish
Pages (from-to)768-781
Number of pages14
JournalJournal of Economic Behavior and Organization
Volume67
Issue3-4
DOIs
Publication statusPublished - Sep 2008

Abstract

Using large-scale panel data, we examine the dynamics of adjustment towards reference points for key workplace attributes. We discover that an Exponential Smooth Transition Autoregressive (ESTAR) model is superior to a linear model in characterizing such a process. The speed of adjustment increases non-linearly with the distance from reference points and adjustment is faster for job satisfaction shocks compared to shocks in earnings or work hours. Our findings lend further credence to the relative utility hypothesis and highlight the inherently non-linear nature of the dynamic path of adjustment towards reference points, a previously neglected issue in the adaptation literature.

Notes

Original article can be found at: http://www.sciencedirect.com/ Copyright Elsevier [Full text of this article is not available in the UHRA]

ID: 462213