A large, mature and robust economic literature on pay for performance now exists, whichprovides a useful framework for thinking about pay for performance systems. I use thelessons of the literature to discuss how to design and implement pay for performance inpractice....

In this paper we show that subtle forms of deceit undermine the effectiveness of incentives.We design an experiment in which the principal has an interest in underreporting the trueperformance difference between the agents in a dynamic tournament...

On theoretical grounds, monitoring of top executives by the (supervisory) board is expectedto be value relevant. The empirical evidence is ambiguous and we analyze three noncompetingexplanations for this ambiguity: (i) The positive effect on firm value of boardmonitoring is hidden in stock price...

The Peter Principle captures two stylized facts about hierarchies: first, promotions often placeemployees into jobs for which they are less well suited than for that previously held. Second,demotions are extremely rare...

How much do developing countries benefit from foreign investment? We contribute to this question by comparing the employment and wage practices of foreign and domestic firms in Brazil, using detailed matched firm-worker panel data...

Do workers sort more randomly across different job types when jobs are harder to find? To answer this question, we study the mobility of male workers among three-digit occupations in the matched files of the monthly Current Population Survey over the 1979-2004 period. We clean individual...

This paper assesses labor market segmentation across formal and informal salaried jobs andself-employment in three Latin American and three transition countries. It looks separately atthe markets for skilled and unskilled labor, inquiring if segmentation is an exclusive feature ofthe latter....

This paper uses British panel data to investigate single women´s labour supply changes inresponse to three tax and benefit policy reforms that occurred in the 1990s. These reformschanged individuals´ work incentives and we use them to identify changes in labour supply.We find evidence of small...

This paper uses longitudinal data from Australia to examine the extent to which overskilling -the extent to which work-related skills and abilities are utilized in current employment - is atransitory phenomenon...

Market imperfections may cause firms and workers to under-invest in specific training. Thispaper shows that profit sharing may be a suitable instrument to enhance specific traininginvestments, either by enhancing wage flexibility or by increasing the returns to training...