We consider the response to incentives as an explanation for productivity differences within a firm that paid its workers piece rates. We provide a framework within which observed productivity differences can be decomposed into two parts: one due to differences in ability and the other due to...

We apply agency theory to the payroll records of a copper mine that paid a production bonus to teams of workers. As with most incentive pay used by firms, the bonus was simpler in form than the optimal contract that balances incentives, insurance, and free-riding. We explore whether transactions...

We examine the effects of different sequences of work and rest on the daily productivity of workers who planted trees in the province of British Columbia, Canada, comparing the intertemporal productivity profiles of planters who were paid either fixed wages or piece rates. We find that planters...

This paper addresses the effects of peer pressure in work teams. Many empirical studies have shed light on the efficiency of peer pressure. Peer pressure can be defined as mechanisms of mutual monitoring and sanction established within a group of agents by the agents themselves in order to...

If policy prescriptions for compensation systems are to be useful, then they must be based on the empirical analysis of incentive effects; i.e., the elasticity of worker effort with respect to changes in the compensation system. We measure the elasticity of worker effort with respect to changes...

We estimate the gain in productivity that is realized by paying workers piece rates rather than fixed wages; i.e., theincentive effect. Our data come from the payroll records of a British Columbia tree-planting firm that paid its workers both piece rates and fixed wages. These data contain...

This paper proposes a unified framework for measuring and managing longevity risk. Specifically, we develop a flexible framework for valuing survivor derivatives like forwards, swaps, as well as options both of European and American style. Our framework is essentially independent of the assumed...