Author: Edward P. Lazear
Publisher:
ISBN:
Category : Piece work
Languages : en
Pages : 34
Book Description
What happens when a firm switches from paying hourly wages to paying piece rates? The theory developed below predicts that average productivity rises, that the firm will attract a more able work force and that the variance in output across individuals at the firm will rise as well. The theory is tested with data from a large autoglass company that changed compensation structures between 1994 and 1995. All theoretical predictions are borne out. In the firm examined, the productivity effects are extremely large, amounting to anywhere from about 20% to 36% of output, depending on what is held constant. About half of the worker-specific increase in productivity is passed on to workers in the form of higher wages
Performance Pay and Productivity
Author: Edward P. Lazear
Publisher:
ISBN:
Category : Piece work
Languages : en
Pages : 34
Book Description
What happens when a firm switches from paying hourly wages to paying piece rates? The theory developed below predicts that average productivity rises, that the firm will attract a more able work force and that the variance in output across individuals at the firm will rise as well. The theory is tested with data from a large autoglass company that changed compensation structures between 1994 and 1995. All theoretical predictions are borne out. In the firm examined, the productivity effects are extremely large, amounting to anywhere from about 20% to 36% of output, depending on what is held constant. About half of the worker-specific increase in productivity is passed on to workers in the form of higher wages
Publisher:
ISBN:
Category : Piece work
Languages : en
Pages : 34
Book Description
What happens when a firm switches from paying hourly wages to paying piece rates? The theory developed below predicts that average productivity rises, that the firm will attract a more able work force and that the variance in output across individuals at the firm will rise as well. The theory is tested with data from a large autoglass company that changed compensation structures between 1994 and 1995. All theoretical predictions are borne out. In the firm examined, the productivity effects are extremely large, amounting to anywhere from about 20% to 36% of output, depending on what is held constant. About half of the worker-specific increase in productivity is passed on to workers in the form of higher wages
Performance Pay and Productivity in Health Care
Author: Brian C. Cadena
Publisher:
ISBN:
Category :
Languages : en
Pages :
Book Description
Nearly half of high earning workers receive performance pay as part of their compensation, but we know strikingly little about the incentive effects of piece rate compensation on high-skilled workers. In this paper, we examine changes in medical providers' output in response to a piece rate compensation scheme. We use data from a Federally Qualified Health Center that changed from a salary-based plan to one that rewarded providers for seeing more patients on a monthly basis. Two key facts guide our empirical approach. First, the timing of the switch from salary to piece rates varied at the individual level depending on the provider's hire date, which allows us to control for other changes over time in patient demand for services. Second, most providers worked under both compensation schemes, which allows us to make within-person comparisons. We further address incomplete compliance by using providers' expected monthly compensation plan status as an instrument for their actual status. We find that providers working under the piece rate scheme see roughly 18 percent more patients monthly. Only a small portion of this difference is due to within-provider changes in output, and we find no evidence that the incentive scheme causes providers to become more productive. Instead, most of this difference derives from compositional changes in the workforce, likely due to increased retention of more productive providers.
Publisher:
ISBN:
Category :
Languages : en
Pages :
Book Description
Nearly half of high earning workers receive performance pay as part of their compensation, but we know strikingly little about the incentive effects of piece rate compensation on high-skilled workers. In this paper, we examine changes in medical providers' output in response to a piece rate compensation scheme. We use data from a Federally Qualified Health Center that changed from a salary-based plan to one that rewarded providers for seeing more patients on a monthly basis. Two key facts guide our empirical approach. First, the timing of the switch from salary to piece rates varied at the individual level depending on the provider's hire date, which allows us to control for other changes over time in patient demand for services. Second, most providers worked under both compensation schemes, which allows us to make within-person comparisons. We further address incomplete compliance by using providers' expected monthly compensation plan status as an instrument for their actual status. We find that providers working under the piece rate scheme see roughly 18 percent more patients monthly. Only a small portion of this difference is due to within-provider changes in output, and we find no evidence that the incentive scheme causes providers to become more productive. Instead, most of this difference derives from compositional changes in the workforce, likely due to increased retention of more productive providers.
Performance Pay and Productivity of Low- and High-Ability Workers
Author: Ignacio Franceschelli
Publisher:
ISBN:
Category :
Languages : en
Pages : 28
Book Description
Existing literature has mainly focused on analyses of the overall effect of a change in the incentive scheme. Lazear (2000), for example, estimates the average increase in productivity after a firm switches from an hourly-wage scheme to a piece-rate plus basic-wage scheme. His paper does not, however, account for the fact that many workers remained within the basic-wage range after the change was made in the incentive scheme. In the present paper we explore how the incentive effect might have been different for those workers seeking the basic wage, and those workers seeking the piece-rate component of the wage. Surprisingly, the change in productivity is approximately the same in percentage terms for both types of workers.
Publisher:
ISBN:
Category :
Languages : en
Pages : 28
Book Description
Existing literature has mainly focused on analyses of the overall effect of a change in the incentive scheme. Lazear (2000), for example, estimates the average increase in productivity after a firm switches from an hourly-wage scheme to a piece-rate plus basic-wage scheme. His paper does not, however, account for the fact that many workers remained within the basic-wage range after the change was made in the incentive scheme. In the present paper we explore how the incentive effect might have been different for those workers seeking the basic wage, and those workers seeking the piece-rate component of the wage. Surprisingly, the change in productivity is approximately the same in percentage terms for both types of workers.
Pay for Performance
Author: National Research Council
Publisher: National Academies Press
ISBN: 0309044278
Category : Business & Economics
Languages : en
Pages : 221
Book Description
"Pay for performance" has become a buzzword for the 1990s, as U.S. organizations seek ways to boost employee productivity. The new emphasis on performance appraisal and merit pay calls for a thorough examination of their effectiveness. Pay for Performance is the best resource to date on the issues of whether these concepts work and how they can be applied most effectively in the workplace. This important book looks at performance appraisal and pay practices in the private sector and describes whetherâ€"and howâ€"private industry experience is relevant to federal pay reform. It focuses on the needs of the federal government, exploring how the federal pay system evolved; available evidence on federal employee attitudes toward their work, their pay, and their reputation with the public; and the complicating and pervasive factor of politics.
Publisher: National Academies Press
ISBN: 0309044278
Category : Business & Economics
Languages : en
Pages : 221
Book Description
"Pay for performance" has become a buzzword for the 1990s, as U.S. organizations seek ways to boost employee productivity. The new emphasis on performance appraisal and merit pay calls for a thorough examination of their effectiveness. Pay for Performance is the best resource to date on the issues of whether these concepts work and how they can be applied most effectively in the workplace. This important book looks at performance appraisal and pay practices in the private sector and describes whetherâ€"and howâ€"private industry experience is relevant to federal pay reform. It focuses on the needs of the federal government, exploring how the federal pay system evolved; available evidence on federal employee attitudes toward their work, their pay, and their reputation with the public; and the complicating and pervasive factor of politics.
Business Performance Measurement
Author: Andy Neely
Publisher: Cambridge University Press
ISBN: 9780521803427
Category : Business & Economics
Languages : en
Pages : 386
Book Description
A multidisciplinary book on performance measurement that will appeal to students, researchers and managers.
Publisher: Cambridge University Press
ISBN: 9780521803427
Category : Business & Economics
Languages : en
Pages : 386
Book Description
A multidisciplinary book on performance measurement that will appeal to students, researchers and managers.
Productivity and Economic Incentives
Author: J. P. Davidson
Publisher: Routledge
ISBN: 1136511490
Category : Business & Economics
Languages : en
Pages : 278
Book Description
As the controversies surrounding performance related pay have demonstrated, reward management is a key issue. Collecting the results of 'fieldwork' investigations in factories and retail outlets, this book measures output before and after a change in methods of remuneration. The link between productivity and stress is explored and conclusions drawn. An introductory chapter, by the eminent economist P. Sargant Florence summarises previously published productivity studies.
Publisher: Routledge
ISBN: 1136511490
Category : Business & Economics
Languages : en
Pages : 278
Book Description
As the controversies surrounding performance related pay have demonstrated, reward management is a key issue. Collecting the results of 'fieldwork' investigations in factories and retail outlets, this book measures output before and after a change in methods of remuneration. The link between productivity and stress is explored and conclusions drawn. An introductory chapter, by the eminent economist P. Sargant Florence summarises previously published productivity studies.
Paying for Performance: An International Comparison
Author: Michelle Brown
Publisher: Routledge
ISBN: 1317463161
Category : Business & Economics
Languages : en
Pages : 313
Book Description
Although performance pay is used in many industrialized nations, the structure and success of this pay system vary widely depending on the institutions, regulatory framework, and legal settings of each country. This book makes the details and effects of these local variations clear for the first time. World-renowned experts on the programs in their respective countries provide in-depth analyses of performance pay in the United States, Canada, France, the United Kingdom, Germany, Australia, Japan, and Brazil. They draw out common themes across the countries, as well as country-specific determinants of the use of performance pay and its level of success.
Publisher: Routledge
ISBN: 1317463161
Category : Business & Economics
Languages : en
Pages : 313
Book Description
Although performance pay is used in many industrialized nations, the structure and success of this pay system vary widely depending on the institutions, regulatory framework, and legal settings of each country. This book makes the details and effects of these local variations clear for the first time. World-renowned experts on the programs in their respective countries provide in-depth analyses of performance pay in the United States, Canada, France, the United Kingdom, Germany, Australia, Japan, and Brazil. They draw out common themes across the countries, as well as country-specific determinants of the use of performance pay and its level of success.
Performance Pay and Enterprise Productivity
An Evaluation of the Effects of a Performance Pay Plan on Productivity of Employees in a Professional Services Firm
The Peril and Promise of Performance Pay
Author: Donald B. Gratz
Publisher: R&L Education
ISBN: 1607090120
Category : Education
Languages : en
Pages : 285
Book Description
This book provides an invaluable resource for school teachers, administrators, board members, policy makers, and citizens who would like to understand what's behind performance pay, what might work and what will not, and how to build a school improvement effort that includes teacher compensation as one of its strategies.
Publisher: R&L Education
ISBN: 1607090120
Category : Education
Languages : en
Pages : 285
Book Description
This book provides an invaluable resource for school teachers, administrators, board members, policy makers, and citizens who would like to understand what's behind performance pay, what might work and what will not, and how to build a school improvement effort that includes teacher compensation as one of its strategies.