Theoretical Analysis of Socio-emotional Signaling in Work Excitation Mechanism

Reciprocity in the workplace makes it possible for employers to motivate their workers to put forward more effort than the minimum requirement. Unfortunately, nor can employers feasibly motivate worker effort in the long term by means of paying more than the market-clearing wage due to the “evaporating” nature of workers´ gratitude from a pay rise. The mathematical model in this paper further proves that sufficiently strong and frequent socio-emotional signals would motivate both observable and unobservable worker effort.