DOES MANAGERIAL COMPENSATION AFFECT WORKERS' EFFORT?

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Hesse N., Rivas M. F.

JOURNAL OF APPLIED ECONOMICS, cilt.18, sa.2, ss.297-323, 2015 (SSCI) identifier identifier

  • Yayın Türü: Makale / Tam Makale
  • Cilt numarası: 18 Sayı: 2
  • Basım Tarihi: 2015
  • Doi Numarası: 10.1016/s1514-0326(15)30013-1
  • Dergi Adı: JOURNAL OF APPLIED ECONOMICS
  • Derginin Tarandığı İndeksler: Social Sciences Citation Index (SSCI), Scopus
  • Sayfa Sayıları: ss.297-323
  • Orta Doğu Teknik Üniversitesi Adresli: Evet

Özet

We explore in a two-level gift-exchange experiment whether the managerial compensation influences workers' effort decisions. Firstly, we find that there exists a strong positive relation between own wage and effort levels for the workers, while the managers' effort reaches a maximum for intermediate wages and decreases for very high wages. Secondly, our data suggests that the managerial compensations are significantly negatively correlated with the workers' effort choices: the higher the manager's wage, the lower the effort level chosen by the workers.