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When designing incentives for a manager, the trade-off between insurance and a good allocation of effort across various tasks is often identified with a trade-off between the responsiveness (sensitivity, precision, signal-noise ratio) of the performance measure and its similarity (congruity,...
Persistent link: https://www.econbiz.de/10010268002
Incentives often fail in inducing economic agents to engage in a desirable activity; implementability is restricted. What restricts implementability? When does re-organization help to overcome this restriction? This paper shows that any restriction of implementability is caused by an...
Persistent link: https://www.econbiz.de/10010278365
Incentives often fail in inducing economic agents to engage in a desirable activity; implementability is restricted. What restricts implementability? When does re-organization help to overcome this restriction? This paper shows that any restriction of implementability is caused by an...
Persistent link: https://www.econbiz.de/10008727777
When designing incentives for a manager, the trade-off between insurance and a “good” allocation of effort across various tasks is often identified with a trade-off between the responsiveness (sensitivity, precision, signal-noise ratio) of the performance measure and its similarity...
Persistent link: https://www.econbiz.de/10005566602
This paper develops a framework for studying individuals ideas about what constitutes justcompensation for chief executive officers (CEOs) and reports estimates of just CEO pay andthe principles guiding ideas of justice. The sample consists of students pursuing a Master ofBusiness Administration...
Persistent link: https://www.econbiz.de/10005861085
We study the determinants of biases in subjective performance evaluations in an MTurk experiment to test the implications of a standard formal framework of rational subjective evaluations. In the experiment, subjects in the role of workers work on a real effort task. Subjects in the role of...
Persistent link: https://www.econbiz.de/10013426345
In teamwork settings, providing effective leadership can be challenging for team leaders due to multitasking and the difficulty in measuring and rewarding leadership input. These challenges might lead to underprovision of leadership activities, which can ultimately impede the productivity of the...
Persistent link: https://www.econbiz.de/10014296867
The Peter Principle states that, after a promotion, the observed output of promotedemployees tends to fall. Lazear (2004) models this principle as resulting from a regression tothe mean of the transitory component of ability...
Persistent link: https://www.econbiz.de/10008939753
This paper studies how altruism between managers and employees affects relational incentive contracts. To this end we develop a simple dynamic principal-agent model where both players may have feelings of altruism or spite toward each other. The con- tract may contain two types of incentives for...
Persistent link: https://www.econbiz.de/10010319459
Empirical studies of the principal-agent relationship find that extrinsic incentives work in many instances, linking rewards to performance increases effort, but that they can also backfire, reducing effort. Intrinsic motivation, the internal drive to work to master a skill or to improve one's...
Persistent link: https://www.econbiz.de/10010319499