Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/233876
Authors: 
Allan, Julia L.
Andelic, Nicole
Bender, Keith A.
Powell, Daniel
Stoffel, Sandro
Theodossiou, Ioannis
Year of Publication: 
2021
Series/Report no.: 
GLO Discussion Paper No. 838
Abstract: 
A growing literature has found a link between performance-related pay (PRP) and poor health, but the causal direction of the relationship is not known. To address this gap, the current paper utilises a crossover experimental design to randomly allocate subjects into a work task paid either by performance or a fixed payment. Stress is measured through self-reporting and salivary cortisol. The study finds that PRP subjects had significantly higher cortisol levels and self-rated stress than those receiving fixed pay, ceteris paribus. By circumventing issues of self-report and self-selection, these results provide novel evidence for the detrimental effect PRP may have on health.
Subjects: 
performance-related pay
stress
experiment
cortisol
JEL: 
J33
I0
C91
Document Type: 
Working Paper

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