The core role of managerial accounting is to provide information to facilitate managers' decisions and influence their behavior through incentives. We study the impact of these two roles of information on profits by implementing a field experiment in a large retail chain. In a 2 × 2 factorial...

We investigate the causal effect of conversations about performance and performance pay implementing a 2x2 field experiment in a retail chain. In the performance pay treatments, managers receive a bonus for profit increases. In the performance review treatments, managers have regular meetings...

We run two field experiments within a large retail chain showing that the effectiveness of performance pay crucially hinges on prior job experience. Introducing sales-based performance pay for district- and later for store-managers, we find negligible average treatment effects. Based on surveys...

We examine the benefits of objective performance measurement in a field experiment conducted in a retail bank. At the outset objective performance measures of pro fits in each branch were only available on the branch level and managers allocated bonuses to their employees based on subjective...

A main prediction of agency theory is the well known risk-incentive trade-off. Incentive contracts should be found in environments with little uncertainty and for agents with low degrees of risk aversion. There is an ongoing debate in the literature about the first trade-off. Due to lack of...

It is often claimed that (i) managers work too hard on operational issues and do not spend enough effort on strategic activities and (ii) something can be done about this by introducing nonfinancial performance measures as for instance with a balanced scorecard. We give an explanation for both...