Fairness properties of compensation schemes
How do different characteristics of pay-for-performance schemes affect fairness perceptions? In two studies, we systematically consider three major classes of incentive schemes: continuous piece rate incentives, discrete bonus schemes, and tournament incentives. We find that pay inequality has a str...
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| Hauptverfasser: | , , , , |
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| Dokumenttyp: | Article (Journal) |
| Sprache: | Englisch |
| Veröffentlicht: |
2025
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| Ausgabe: | Online ahead of print |
| In: |
The journal of law, economics, and organization
Year: 2025, Pages: 1-25 |
| ISSN: | 1465-7341 |
| DOI: | 10.1093/jleo/ewaf016 |
| Online-Zugang: | Verlag, kostenfrei, Volltext: https://doi.org/10.1093/jleo/ewaf016
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| Verfasserangaben: | Christoph K. Becker, Dietmar Fehr, Hannes Rau, Stefan T. Trautmann, and Yilong Xu |
| Zusammenfassung: | How do different characteristics of pay-for-performance schemes affect fairness perceptions? In two studies, we systematically consider three major classes of incentive schemes: continuous piece rate incentives, discrete bonus schemes, and tournament incentives. We find that pay inequality has a strong negative effect on perceived fairness. Controlling for pay inequality, people consider piece rate schemes fairer than those with a discrete bonus and a tournament design in particular. Adding performance-dependent resource advantages or handicaps negatively influences perceived fairness. We find that procedural fairness judgments are an important factor influencing overall judgments and demonstrate in a third study that the latter have relevant behavioral consequences (JEL C90, D63, J31, J41). |
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| Beschreibung: | Online veröffentlicht am 18. November 2025 Gesehen am 13.01.2026 |
| Beschreibung: | Online Resource |
| ISSN: | 1465-7341 |
| DOI: | 10.1093/jleo/ewaf016 |