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Exploitation Aversion: When Financial Incentives Fail to Motivate Agents

Carpenter, Jeffrey P.; Dolifka, David - Institute for the Study of Labor (IZA) - 2013

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/10010680481

Workers' Participation in Wage Setting and Opportunistic Behavior: Evidence from a Gift-Exchange Experiment

Franke, Jörg; Mertins, Vanessa; Gurtoviy, Ruslan - Institut für Arbeitsrecht und Arbeitsbeziehungen in … - 2014

Our study analyzes the consequences of workers' participation in the wage setting process on effort exertion. The experimental design is based on a modified giftexchange game where the degree of workers’ involvement in the wage setting process is systematically varied among the workers. The...

Persistent link: https://www.econbiz.de/10010775967

Leniency Bias in Long-Term Workplace Relationships

Tichem, Jan - Tinbergen Instituut - 2013

This paper studies how firms can efficiently incentivize supervisors to truthfully report employee performance. To this end, I develop a dynamic principal-supervisor-agent model. The supervisor is either selfish or altruistic towards the agent, which is observable to the agent but not to the...

Persistent link: https://www.econbiz.de/10011256342

Paid to quit

Dur, Robert; Schmittdiel, Heiner - Tinbergen Instituut - 2013

Inspired by a recent observation about an online retail company, this paper explains why a firm may find it optimal to offer an exit bonus to recent hires so as to induce self-selection. We study a double adverse selection problem, in which the principal can neither observe agents’ commitment...

Persistent link: https://www.econbiz.de/10011256343

Performance pay and risk aversion

Grund, Christian; Sliwka, Dirk - 2006

environments with little uncertainty and for agents with low degrees of risk aversion. There is an ongoing debate in the literature …

Persistent link: https://www.econbiz.de/10010365868

An Empirical Analysis of Risk, Incentives and the Delegation of Worker Authority

DeVaro, Jed - 2010

Traditionally, researchers have had difficulty testing the relationship between the degree of risk or uncertainty in …

Persistent link: https://www.econbiz.de/10013137206

Risk Preferences, Compensation Risk, and Employee Outcomes

Kurtulus, Fidan Ana - 2012

We use the NBER Shared Capitalism Database comprised of more than 40,000 employee surveys from 14 firms to explore whether a close match between workers' risk preferences and the riskiness of their compensation packages relates to improved employee outcomes including lower absenteeism, lower...

Persistent link: https://www.econbiz.de/10013109193

Retirement Revolution : Unmitigated Risks in the Defined Contribution Society

Tucker, Anne M. - 2013

Persistent link: https://www.econbiz.de/10013086247

Uncertainty Avoidance and the Timing of Employee Stock Option Exercise

Bova, Francesco - 2018

We examine the impact of the cultural norm of uncertainty avoidance on employee stock option (ESO) exercise behaviour … using proprietary data from a multinational firm. We find that employees from countries with higher levels of uncertainty … that employee attitudes towards uncertainty influence stock option exercise behaviours. Our findings further help to …

Persistent link: https://www.econbiz.de/10012936898

Industry Tournament Incentives and Stock Price Crash Risk

Kubick, Thomas R. - 2020

Theoretical and empirical studies argue that managerial hoarding of negative firm-specific information can result in large negative stock price corrections once the accumulated information is revealed. A managerial labor market with tournament-like progression provides managers with the...

Persistent link: https://www.econbiz.de/10012825407