Incomplete Information Erodes Trust and Reciprocity in Labor Relations
Workers tend to work harder when they are paid well, especially when they know how much extra value they are delivering. However, if the information about the value is not complete or fair, trust and cooperation can suffer. In a controlled experiment, researchers tested how workers reacted when they only had part of the picture. They found that when workers didn't have all the information they needed, both their effort and the effectiveness of their work decreased. Trust and cooperation were significantly lower when the information was incomplete compared to when everything was clear. The impact was even worse when the information was not the same for everyone involved, with wages and efficiency taking a big hit.