Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/125377 
Year of Publication: 
2015
Citation: 
[Journal:] IZA World of Labor [ISSN:] 2054-9571 [Article No.:] 152 [Publisher:] Institute for the Study of Labor (IZA) [Place:] Bonn [Year:] 2015
Publisher: 
Institute for the Study of Labor (IZA), Bonn
Abstract: 
Many firms offer employees a remuneration package that links pay to performance as a means of motivation. It also improves efficiency and reduces turnover and absenteeism. The effects on productivity depend on the type of scheme employed (individual or group performance) and its design (commissions, piece-rate or sharing schemes). Individual incentives demonstrate the largest effect, while group or team incentives are smaller in magnitude. The case for government intervention through tax breaks and other financial incentives is highly debated due to differences across firms and the potential for economic inefficiencies.
Subjects: 
performance-related pay
productivity
pay incentives
financial participation
JEL: 
J31
J33
J52
L61
Persistent Identifier of the first edition: 
Document Type: 
Article

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