Footnote:
Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments February 18, 2022 erstellt
Description:
We investigate the difference between monetary incentives and monetary gifts on employees’ performance using a firm-level field experiment. We randomly assign store managers of a German discount supermarket chain to two different groups. In the first treatment, the store managers receive a monthly bonus depending on profit increases (performance pay). In the second treatment, the store managers receive a monthly unconditional fixed payment to increase profits (gift). We find that, overall, performance pay on average significantly outperforms the gift by approximately 8% in profit increases. However, we also find evidence that this effect depends on the relative size of the gift. The higher the relative size of the gift compared to the employees’ monthly wage, the stronger is its performance-enhancing effect. These results provide evidence that the informal control of an unconditional fixed monetary bonus, if large enough, can be a beneficial alternative to performance pay