Performance Pay and Adverse Selection

It is well known in personnel economics that firms may improve the quality of their workforce by offering performance pay. We analyse an equilibrium model where worker productivity is private information and show that the gains to the firms from worker self-selection may not be matched by a corresponding social gain. In particular, the equilibrium incentive to workers to exert too much effort.

MoreLess

Year of publication:	2004-08
Authors:	Moen, Espen R ; Rosén, Åsa
Institutions:	C.E.P.R. Discussion Papers
Subject:	efficiency \| performance pay \| selection

Online Resource

Check full text access |

More access options

Check Google Scholar

In German libraries (KVK)

I need help

More details

Extent:	application/pdf
Series:	CEPR Discussion Papers.
Type of publication:	Book / Working Paper
Notes:	Number 4511
Classification:	D82 - Asymmetric and Private Information ; J30 - Wages, Compensation, and Labor Costs. General
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10005123693