Country-Compatible Incentive Design
AbstractToday’s management faces the challenge of employing workforces in different countries. Institutional frameworks, both formal and informal, in various countries influence employees’ preferences related to performance rewards and management styles. We conduct an empirical study to examine employees of a German multinational corporation at its locations in China, Germany, Japan, and the U.S. We find that employees from these countries have different preferences on incentives and management styles. Therefore, motivational mechanisms designed for one country might not work in others. We also find that the logic of diminishing marginal utility applies to most performance rewards.
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Bibliographic InfoArticle provided by LMU Munich School of Management in its journal Schmalenbach Business Review.
Volume (Year): 61 (2009)
Issue (Month): 3 (July)
Incentive Compensation; Institutional Frameworks; Management Style; Motivation; Performance Rewards;
Find related papers by JEL classification:
- M12 - Business Administration and Business Economics; Marketing; Accounting - - Business Administration - - - Personnel Management; Executives; Executive Compensation
- M16 - Business Administration and Business Economics; Marketing; Accounting - - Business Administration - - - International Business Administration
- M52 - Business Administration and Business Economics; Marketing; Accounting - - Personnel Economics - - - Compensation and Compensation Methods and Their Effects
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