A large, mature and robust economic literature on pay for performance now exists, which provides a useful framework for thinking about pay for performance systems. I use the lessons of the literature to discuss how to design and implement pay for performance in practice

We develop a simple model of the effects of reputation on wine prices. An increasing fraction of consumers who are “naïve” (less well informed about wine quality) results in a stronger sensitivity of wine prices to ratings of quality. We then use data on prices and Robert Parker’s ratings...

We examine the organizational dynamics of integration post merger. Our basic question is whether <p> there is evidence of conflict between employees from the two merging firms. Such conflict can arise <p> for several reasons, including firm-specific human capital, corporate culture, power, or...</p></p>

Personnel records are used to examine compensation, recruitment, and retention of a group of very highly skilled workers: civilian scientists and engineers in U.S. Department of Defense laboratories. In contrast to the private sector, returns to skills were largely flat for this group from...

In this paper we study job design. Will an organization plan precisely how the job is to be done ex ante, or ask workers to determine the process as they go? We first model this decision and predict complementarity between these job attributes: multitasking, discretion, skills, and...

Salary data from a single firm are analyzed in an effort to identify the firm's wage policy. The authors find that employees are partly shielded against changes in external market conditions; that wage variation within a job level is large both cross-sectionally and for individuals over time,...

Drawing on a single large U.S. corporation's personnel records for the years 1989-93, the authors analyze an example of the kind of formal salary system used by most large firms. The system was highly centralized, covering salary levels, salary ranges, raises, and bonuses. Supervisors had little...

We analyze twenty years of personnel data from one firm. The hierarchical structure is quite simple and stable. Career movements suggest that the employee's rate of learning and the firm's learning about ability are important. There are promotion 'fast tracks.' Exit rates vary little with tenure...