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Piece Rates, Fixed Wages and Incentives: Evidence from a Field Experiment
Open accessAbstract
Data from a field experiment are used to estimate the gain in productivity that is realized when workers are paid piece rates rather than fixed wages. The experiment was conducted within a tree-planting firm and provides daily observations on individual worker productivity under both compensation systems. Unrestricted statistical methods estimate the productivity gain to be 20%. Since planting conditions potentially affect incentives, structural econometric methods are used to generalize the experimental results to out-of-sample conditions. The structural results suggest that the average productivity gain, outside of the experimental conditions, would be at least 21.7%.
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Citations
Cites
The Provision of Incentives in Firms
Prendergast, C. (1999) · Journal of Economic Literature · doi:10.1257/jel.37.1.7 · Cited by 3,338
Cited by
Fairness and retaliation: the economics of reciprocity
Fehr, E., & Gächter, S. (2000) · Journal of Economic Perspectives · doi:10.1257/jep.14.3.159 · Cited by 3,239
Syverson, C. (2011) · Journal of Economic Literature · doi:10.1257/jel.49.2.326 · Cited by 2,942
Observing Unobservables: Identifying Information Asymmetries With a Consumer Credit Field Experiment
(2009) · Econometrica · doi:10.3982/ecta5781 · Cited by 503
Personnel Economics: The Economist's View of Human Resources
Lazear, E. P., & Shaw, K. L. (2007) · Journal of Economic Perspectives · doi:10.1257/jep.21.4.91 · Cited by 470
Podsakoff, P. M., & Podsakoff, N. P. (2019) · The Leadership Quarterly · doi:10.1016/j.leaqua.2018.11.002 · Cited by 312
Metadata
- Authors
- Shearer, B.
- Venue
- The Review of Economic Studies
- Publisher
- Oxford University Press (OUP)
- Published
- 2004-04
- Volume
- 71
- Issue
- 2
- Pages
- 513-534
- ISSN
- 0034-6527 (ISSN-L)
- 1467-937X
- OpenAlex
- W2108379100
- Cited by
- 412
- References
- 1
- FWCI
- 24.50
- Type
- journal article
- Language
- en
- Open access
- green
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