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Firm‐Wide Incentives and Mutual Monitoring at Continental Airlines
Abstract
In February 1995 Continental Airlines introduced an incentive scheme that promised monthly bonuses to all 35,000 hourly employees if the company achieved a firm‐wide performance goal. Conventional wisdom suggests that free riding will render such schemes ineffective. We present evidence indicating that the incentive scheme raised employee performance despite the apparent threat of free riding. To explain why the scheme may have been effective we argue that the organization of employees into autonomous work groups enabled Continental to induce mutual monitoring among employees within each work group.
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Olson, M. (1965) · doi:10.4159/9780674041660 · Cited by 14,191
Cited by
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Gittell, J. H., Cameron, K., Lim, S., & Rivas, V. (2006) · The Journal of Applied Behavioral Science · doi:10.1177/0021886306286466 · Cited by 690
Driving forces behind informal sanctions
Falk, A., Fehr, E., & Fischbacher, U. (2005) · Econometrica · doi:10.1111/j.1468-0262.2005.00644.x · Cited by 451
Benabou, R., & Tirole, J. (2011) · doi:10.3386/w17579 · Cited by 227
Efficiency gains from team-based coordination-large-scale experimental evidence
Feri, F., Irlenbusch, B., & Sutter, M. (2010) · American Economic Review · doi:10.1257/aer.100.4.1892 · Cited by 98
Metadata
- Authors
- Knez, M., & Simester, D.
- Venue
- Journal of Labor Economics
- Publisher
- University of Chicago Press
- Published
- 2001-10
- Volume
- 19
- Issue
- 4
- Pages
- 743-772
- ISSN
- 0734-306X (ISSN-L)
- 1537-5307
- OpenAlex
- W3121142520
- Cited by
- 376
- References
- 1
- FWCI
- 13.24
- Type
- journal article
- Language
- en
- Open access
- closed
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