Dynamic Peer Effects in Sales Teams
AbstractThis paper investigates dynamic peer effects in a sales company where workers operate in teams and receive a bonus that depends on both individual worker and team sales. We examine how the past productivity of co-workers affects the current individual performance of team members. To address this question, we employ weekly productivity and administrative data obtained from the customer service center of an insurance company. We find evidence that the past performance of team co-workers influences current performance, and that this effect is larger for agents that ranked in the bottom quartile of team performance in the previous period. The effects are also strongest when bonuses depend on team performance. Overall, our findings suggest that peer effects may alleviate the free-rider problem often associated with team bonuses.
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Bibliographic InfoPaper provided by University of Bergen, Department of Economics in its series Working Papers in Economics with number 10/13.
Length: 35 pages
Date of creation: 01 Nov 2013
Date of revision:
Contact details of provider:
Postal: Institutt for økonomi, Universitetet i Bergen, Postboks 7802, 5020 Bergen, Norway
Web page: http://www.uib.no/econ/en
More information through EDIRC
Peer effects; dynamic panel data; team incentives; sales organizations;
Find related papers by JEL classification:
- C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
- D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis
- J33 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Compensation Packages; Payment Methods
- M52 - Business Administration and Business Economics; Marketing; Accounting - - Personnel Economics - - - Compensation and Compensation Methods and Their Effects
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