Incentives in business and academia

Arbeitspapier

This paper discusses some issues of compensation policy in business and academia from the perspectives of incentive theory, other theories, and empirical research. The main conclusion is that mechanical rules for performance-related pay are likely to be inferior to more subjective performance evaluation criteria. Formalized performance pay, where pay is directly linked to measures of output, can easily have dysfunctional effects, especially when some dimensions of performance are easier to observe than others. Subjective performance evaluation is not perfect, but it is probably the best method to obtain a holistic assessment of multidimensional performance indicators.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Working Paper ; No. 2009:9

Classification and Topics

• Classification: Wirtschaft ; Wages, Compensation, and Labor Costs: General ; Compensation Packages; Payment Methods
• Subject: compensation policy ; performance-based pay ; incentive theory ; Vergütungssystem ; Leistungsentgelt ; Ökonomischer Anreiz ; Personalbeurteilung ; Theorie

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Holmlund, Bertil
• Event: Veröffentlichung
• (who): Uppsala University, Department of Economics
• (where): Uppsala
• (when): 2009

Further information

• Handle: http://hdl.handle.net/10419/82567
• URN: urn:nbn:se:uu:diva-105990
• Last update: 10.03.2025, 11:42 AM CET