Arbeitspapier
Talking about Performance or Paying for it? Evidence from a Field Experiment
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 with their supervisors discussing their activities to increase profits. We find that review conversations raise profits by 7%-8%. However, when additionally receiving performance pay this effect vanishes. Analyzing an extension of Bénabou and Tirole (2006), we rationalize this effect formally and provide empirical evidence that the use of performance pay changes the nature of conversations undermining their value.
- Language
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Englisch
- Bibliographic citation
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Series: IZA Discussion Papers ; No. 12446
- Classification
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Wirtschaft
Field Experiments
- Subject
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performance pay
performance reviews
monitoring
feedback
field experiment
management practices
- Event
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Geistige Schöpfung
- (who)
-
Manthei, Kathrin
Sliwka, Dirk
Vogelsang, Timo
- Event
-
Veröffentlichung
- (who)
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Institute of Labor Economics (IZA)
- (where)
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Bonn
- (when)
-
2019
- Handle
- Last update
-
10.03.2025, 11:42 AM CET
Data provider
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
Object type
- Arbeitspapier
Associated
- Manthei, Kathrin
- Sliwka, Dirk
- Vogelsang, Timo
- Institute of Labor Economics (IZA)
Time of origin
- 2019
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