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Individual incentives and workers' contracts: Evidence from a field experiment

Choudhary, M. Ali, Gabriel, Vasco J. and Rickman, Neil (2019) Individual incentives and workers' contracts: Evidence from a field experiment Oxford Economic Papers.

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Abstract

We present evidence on the operation of incentive pay from a field experiment in Pakistan, looking at piece rates and pay based on rank achieved in a tournament. Importantly, some workers are in contracts ‘tying’ them to the employer for several picking seasons; others are 'untied' in the sense of being employed for only the current season. We find that incentive pay (of either type) improves productivity by 30% on average, but that there are important differences across the types of workers: in particular, tournament incentives are less effective amongst the tied workers. We suggest that our main results have implications for tournament theory and the design of incentive pay schemes, particularly to the extent that they may discourage some workers and, thus, reduce incentives.

Item Type: Article
Divisions : Faculty of Arts and Social Sciences > School of Economics
Authors :
NameEmailORCID
Choudhary, M. Ali
Gabriel, Vasco J.V.Gabriel@surrey.ac.uk
Rickman, NeilN.Rickman@surrey.ac.uk
Date : 28 November 2019
Funders : Nuffield Foundation
DOI : 10.1093/oep/gpz061
Copyright Disclaimer : © Oxford University Press 2019.All rights reserved. This article is published and distributed under the terms of the Oxford University Press, Standard Journals Publication Model (https://academic.oup.com/journals/pages/open_access/funder_policies/chorus/standard_publication_model)
Related URLs :
Depositing User : Clive Harris
Date Deposited : 02 Oct 2019 08:45
Last Modified : 13 Dec 2019 15:49
URI: http://epubs.surrey.ac.uk/id/eprint/852850

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