IDEAS home Printed from https://ideas.repec.org/p/ehl/lserod/25423.html
   My bibliography  Save this paper

Institutions and the management of human resources: incentive pay systems in France and Great Britain

Author

Listed:
  • Marsden, David
  • Belfield, Richard

Abstract

Using data from large-scale establishment surveys in Britain and France, we show that incentive pay for non-managers is more widespread in France than in Britain. We explain this finding in terms of the ‘beneficial constraint’ arising from stronger employment protection in France, which provides an impulse to develop incentive pay; employer networking activities in France, which facilitate joint learning about its development and operation; and government fiscal incentives for profit-sharing, which reduces the cost of its operation.

Suggested Citation

  • Marsden, David & Belfield, Richard, 2009. "Institutions and the management of human resources: incentive pay systems in France and Great Britain," LSE Research Online Documents on Economics 25423, London School of Economics and Political Science, LSE Library.
    • Handle: RePEc:ehl:lserod:25423
    as

    Download full text from publisher

    File URL: http://eprints.lse.ac.uk/25423/
    File Function: Open access version.
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Blanchflower, David G. & Bryson, Alex & Forth, John, 2006. "Workplace Industrial Relations in Britain, 1980-2004," IZA Discussion Papers 2518, Institute of Labor Economics (IZA).
    2. Finegold, David, 1999. "Creating Self-Sustaining, High-Skill Ecosystems," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 15(1), pages 60-81, Spring.
    3. Canice Prendergast, 1999. "The Provision of Incentives in Firms," Journal of Economic Literature, American Economic Association, vol. 37(1), pages 7-63, March.
    4. Duncan Gallie & Alan Felstead & Francis Green, 2004. "Changing Patterns of Task Discretion in Britain," Work, Employment & Society, British Sociological Association, vol. 18(2), pages 243-266, June.
    5. John T. Addison & Clive R. Belfield, 2008. "The Determinants of Performance Appraisal Systems: A Note (Do Brown and Heywood's Results for Australia Hold Up for Britain?)," British Journal of Industrial Relations, London School of Economics, vol. 46(3), pages 521-531, September.
    6. Bryson, Alex & Freeman, Richard, 2008. "How does shared capitalism affect economic performance in the UK?," LSE Research Online Documents on Economics 51596, London School of Economics and Political Science, LSE Library.
    7. Francis Green, 2008. "Leeway for the Loyal: A Model of Employee Discretion," British Journal of Industrial Relations, London School of Economics, vol. 46(1), pages 1-32, March.
    8. Richard B. Freeman & Morris M. Kleiner, 1998. "The Last American Shoe Manufacturers: Changing the Method of Pay to Survive Foreign Competition," NBER Working Papers 6750, National Bureau of Economic Research, Inc.
    9. Jelle Visser, 1998. "Two Cheers for Corporatism, One for the Market: Industrial Relations, Wage Moderation and Job Growth in the Netherlands," British Journal of Industrial Relations, London School of Economics, vol. 36(2), pages 269-292, June.
    10. Kandel, Eugene & Lazear, Edward P, 1992. "Peer Pressure and Partnerships," Journal of Political Economy, University of Chicago Press, vol. 100(4), pages 801-817, August.
    11. John Godard, 2004. "A Critical Assessment of the High‐Performance Paradigm," British Journal of Industrial Relations, London School of Economics, vol. 42(2), pages 349-378, June.
    12. Eyraud, Francois & Marsden, David & Silvestre, Jean-Jacques, 1990. "Occupational and internal labour markets in Britain and France," LSE Research Online Documents on Economics 21305, London School of Economics and Political Science, LSE Library.
    13. Bryson, Alex & Freeman, Richard B., 2007. "Doing the right thing? does fair share capitalism improve workplace performance," LSE Research Online Documents on Economics 4964, London School of Economics and Political Science, LSE Library.
    14. repec:nsr:niesrd:319 is not listed on IDEAS
    15. Gregg, P. A. & Machin, S. J., 1988. "Unions and the incidence of performance linked pay schemes in Britain," International Journal of Industrial Organization, Elsevier, vol. 6(1), pages 91-107, March.
    16. Robert McNabb & Keith Whitfield, 2001. "Job Evaluation and High Performance Work Practices: Compatible or Conflictual?," Journal of Management Studies, Wiley Blackwell, vol. 38(2), pages 293-312, March.
    17. Joseph Lanfranchi & John Treble, 2010. "Just‐In‐Time Production, Work Organization And Absence Control," Manchester School, University of Manchester, vol. 78(5), pages 460-483, September.
    18. Holmstrom, Bengt & Milgrom, Paul, 1991. "Multitask Principal-Agent Analyses: Incentive Contracts, Asset Ownership, and Job Design," The Journal of Law, Economics, and Organization, Oxford University Press, vol. 7(0), pages 24-52, Special I.
    19. Robert Drago & John S. Heywood, 1994. "The Choice of Payment Schemes: Australian Establishment Data," Labor and Demography 9402001, University Library of Munich, Germany, revised 04 Feb 1994.
    20. Dale Belman & Robert Drago & Mark Wooden, 1992. "Workgroups, Efficiency Wages and Work Effort," Journal of Post Keynesian Economics, Taylor & Francis Journals, vol. 14(4), pages 497-521, July.
    21. George A. Akerlof, 1982. "Labor Contracts as Partial Gift Exchange," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 97(4), pages 543-569.
    22. Casey Ichniowski & Kathryn Shaw, 2003. "Beyond Incentive Pay: Insiders' Estimates of the Value of Complementary Human Resource Management Practices," Journal of Economic Perspectives, American Economic Association, vol. 17(1), pages 155-180, Winter.
    23. Blanchflower, David G. & Bryson, Alex & Forth, John, 2006. "Workplace Industrial Relations in Britain, 1980-2004," IZA Discussion Papers 2518, Institute of Labor Economics (IZA).
    24. Sylvie Mabile, 1998. "Intéressement et salaires : complémentarité ou substitution ?," Économie et Statistique, Programme National Persée, vol. 316(1), pages 45-61.
    25. Christopher L. Erickson & Sanford M. Jacoby, 2003. "The Effect of Employer Networks on Workplace Innovation and Training," ILR Review, Cornell University, ILR School, vol. 56(2), pages 203-223, January.
    26. Finegold, David & Soskice, David, 1988. "The Failure of Training in Britain: Analysis and Prescription," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 4(3), pages 21-53, Autumn.
    27. Michelle Brown & John S. Heywood, 2005. "Performance Appraisal Systems: Determinants and Change," British Journal of Industrial Relations, London School of Economics, vol. 43(4), pages 659-679, December.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Davide Antonioli & Paolo Pini & Roberto Antonietti, 2014. "Flexible pay systems and labour productivity: Evidence from Emilia-Romagna manufacturing firms," Working Papers 2014143, University of Ferrara, Department of Economics.
    2. Thomas Amossé & Philippe Askenazy & Martin Chevalier & Christine Erhel & Héloïse Petit & Antoine Rebérioux, 2016. "Industrial Relations and Firms’ Reactions to the Recession: A Comparative Micro-Econometric Analysis of France and Great Britain [Relations sociales et ajustements à la crise : une analyse micro-st," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) hal-02172455, HAL.
    3. Ana Rincon-Aznar, 2009. "Rates of return and alternative measures of capital input: 14 countries and 10 branches, 1971-2005," National Institute of Economic and Social Research (NIESR) Discussion Papers 347, National Institute of Economic and Social Research.
    4. Marsden, David, 2010. "The end of national models in employment relations?," LSE Research Online Documents on Economics 48913, London School of Economics and Political Science, LSE Library.
    5. Leone Leonida & Antonio Giangreco & Sergio Scicchitano & Marco Biagetti, 2023. "Britain and BrExit: Is the UK more attractive to supervisors? An analysis of the wage premium to supervision across the EU," British Journal of Industrial Relations, London School of Economics, vol. 61(2), pages 291-312, June.
    6. Valeria Pulignano & Andrea Signoretti, 2016. "Union Strategies, National Institutions and the Use of Temporary Labour in Italian and US Plants," British Journal of Industrial Relations, London School of Economics, vol. 54(3), pages 574-596, September.
    7. Nicolas Castel & Noélie Delahaie & Héloïse Petit, 2011. "Quels modes de négociation face à des politiques salariales renouvelées ?," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) hal-00646434, HAL.
    8. Biagetti, Marco & Giangreco, Antonio & Leonida, Leone & Scicchitano, Sergio, 2020. "BrExit or BritaIn: Is the UK more Attractive to Supervisors? An Analysis of Wage Premium to Supervision across the EU," GLO Discussion Paper Series 510, Global Labor Organization (GLO).
    9. Sila, Urban, 2009. "Can family-support policies help explain differences in working hours across countries?," LSE Research Online Documents on Economics 28684, London School of Economics and Political Science, LSE Library.
    10. Mirella Damiani & Fabrizio Pompei & Andrea Ricci, 2023. "Tax breaks for incentive pay, productivity and wages: Evidence from a reform in Italy," British Journal of Industrial Relations, London School of Economics, vol. 61(1), pages 188-213, March.
    11. Noélie Delahaie & Richard Duhautois, 2013. "L'impact des dispositifs collectifs de partage des bénéfices sur les rémunérations en France. Une analyse empirique sur la période 1999-2007," Working Papers halshs-00967479, HAL.
    12. Noélie Delahaie & Richard Duhautois, 2019. "Profit‐Sharing and Wages: An Empirical Analysis Using French Data between 2000 and 2007," British Journal of Industrial Relations, London School of Economics, vol. 57(1), pages 107-142, March.
    13. David Marsden, 2010. "Individual Voice in Employment Relationships: A Comparison Under Different Collective Voice Regimes," CEP Discussion Papers dp1006, Centre for Economic Performance, LSE.
    14. repec:hal:spmain:info:hdl:2441/6o65lgig8d0qcro9oj599gl90 is not listed on IDEAS
    15. Petr Petera & Jana Fibírová, 2015. "Basic Approaches to Profit-Sharing and Ideas for Utilization [Základní přístupy k "profit-sharingu" a náměty na další využití]," Český finanční a účetní časopis, Prague University of Economics and Business, vol. 2015(3), pages 97-117.
    16. Michael Zemmour, 2013. "Les dépenses socio-fiscales ayant trait à la protection sociale : état des lieux," Sciences Po publications info:hdl:2441/6o65lgig8d0, Sciences Po.
    17. Xulia González & Rosa Loveira & Consuelo Pazó, 2022. "Performance pay, firm size and export market participation: Evidence from matched employer–employee data," LABOUR, CEIS, vol. 36(3), pages 342-366, September.
    18. Thomas AMOSSÉ & Philippe ASKENAZY & Martin CHEVALIER & Christine ERHEL & Héloïse PETIT & Antoine REBÉRIOUX, 2019. "Industrial relations and adjustments to the crisis: A comparative micro‐statistical analysis of France and Great Britain," International Labour Review, International Labour Organization, vol. 158(3), pages 463-487, September.
    19. Patrice Laroche & Mathieu Floquet & Loris Guery & Chloé Guillot-Soulez & Anne Stévenot, 2013. "Les relations entre épargne salariale et rémunérations : une analyse des stratégies et de la cohérence des pratiques," Post-Print halshs-00863544, HAL.
    20. Sarah Ashwin, 2021. "In memoriam David Marsden 1950–2021," British Journal of Industrial Relations, London School of Economics, vol. 59(4), pages 979-981, December.
    21. Nicolas Castel & Noélie Delahaie & Héloïse Petit, 2014. "Diversity of Compensation Policies and Wage Collective Bargaining in France [Diversidad de Política de Compensación y Negociación colectiva de Salario en Francia]," Post-Print hal-01625986, HAL.
    22. Thomas Amosse & Alex Bryson & John Forth & Heloise Petit, 2023. "The Micro-Foundations of Employment Systems: An Empirical Case Study of Britain and France," DoQSS Working Papers 23-04, Quantitative Social Science - UCL Social Research Institute, University College London.
    23. Doellgast, Virginia & Marsden, David, 2019. "Institutions as constraints and resources: explaining cross-national divergence in performance management," LSE Research Online Documents on Economics 89978, London School of Economics and Political Science, LSE Library.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Heywood, John S. & Jirjahn, Uwe, 2009. "Profit sharing and firm size: The role of team production," Journal of Economic Behavior & Organization, Elsevier, vol. 71(2), pages 246-258, August.
    2. John S. Heywood & Uwe Jirjahn, 2014. "Variable Pay, Industrial Relations and Foreign Ownership: Evidence from Germany," British Journal of Industrial Relations, London School of Economics, vol. 52(3), pages 521-552, September.
    3. Thomas Cornelissen & John S. Heywood & Uwe Jirjahn, 2010. "Profit Sharing and Reciprocity: Theory and Survey Evidence," SOEPpapers on Multidisciplinary Panel Data Research 292, DIW Berlin, The German Socio-Economic Panel (SOEP).
    4. Uwe Jirjahn & Erik Poutsma, 2013. "The Use of Performance Appraisal Systems: Evidence from Dutch Establishment Data," Industrial Relations: A Journal of Economy and Society, Wiley Blackwell, vol. 52(4), pages 801-828, October.
    5. Thomas Cornelissen & John Heywood & Uwe Jirjahn, 2014. "Reciprocity and Profit Sharing: Is There an Inverse U-shaped Relationship?," Journal of Labor Research, Springer, vol. 35(2), pages 205-225, June.
    6. Alberto Bayo-Moriones & Jose Enrique Galdon-Sanchez & Sara Martinez-De-Morentin, 2013. "The Diffusion of Pay for Performance across Occupations," ILR Review, Cornell University, ILR School, vol. 66(5), pages 1115-1148, October.
    7. Uwe Jirjahn & Jens Mohrenweiser, 2019. "Performance Pay and Applicant Screening," British Journal of Industrial Relations, London School of Economics, vol. 57(3), pages 540-575, September.
    8. Michael Waldman, 2012. "Theory and Evidence in Internal LaborMarkets [The Handbook of Organizational Economics]," Introductory Chapters,, Princeton University Press.
    9. Jirjahn, Uwe & Mohrenweiser, Jens, 2023. "Variable Payment Schemes and Productivity: Do Individual-Based Schemes Really Have a Stronger Influence than Collective Ones?," IZA Discussion Papers 16267, Institute of Labor Economics (IZA).
    10. Alberto Bayo-Moriones & Jose E. Galdon-Sanchez & Sara Martinez-de-Morentin, 2017. "Performance Measurement and Incentive Intensity," Journal of Labor Research, Springer, vol. 38(4), pages 496-546, December.
    11. Matthew McGinty, 2014. "Strategic Incentives in Teams: Implications of Returns to Scale," Southern Economic Journal, John Wiley & Sons, vol. 81(2), pages 474-488, October.
    12. Vladimir Pecheu, 2021. "Profit Sharing as a Bargaining Weapon Against Unions," Working Papers halshs-03247551, HAL.
    13. Fali Huang & Peter Cappelli, 2006. "Employee Screening: Theory and Evidence," NBER Working Papers 12071, National Bureau of Economic Research, Inc.
    14. Margit Osterloh & Bruno S. Frey, 2000. "Motivation, Knowledge Transfer, and Organizational Forms," Organization Science, INFORMS, vol. 11(5), pages 538-550, October.
    15. Uwe Jirjahn, 2018. "The adoption and termination of profit sharing for employees: does management’s attitude play a role?," Applied Economics, Taylor & Francis Journals, vol. 50(2), pages 108-127, January.
    16. Ann Bartel & Brianna Cardiff-Hicks & Kathryn Shaw, 2013. "Compensation Matters: Incentives for Multitasking in a Law Firm," NBER Working Papers 19412, National Bureau of Economic Research, Inc.
    17. Oriana Bandiera & Iwan Barankay & Imran Rasul, 2009. "Social Connections and Incentives in the Workplace: Evidence From Personnel Data," Econometrica, Econometric Society, vol. 77(4), pages 1047-1094, July.
    18. Heywood, John S. & Jirjahn, Uwe & Struewing, Cornelia, 2017. "Locus of control and performance appraisal," Journal of Economic Behavior & Organization, Elsevier, vol. 142(C), pages 205-225.
    19. Bayo-Moriones, Alberto & Galdon-Sanchez, Jose Enrique & Martinez-de-Morentin, Sara, 2011. "Performance Appraisal: Dimensions and Determinants," IZA Discussion Papers 5623, Institute of Labor Economics (IZA).
    20. Abeler, Johannes & Altmann, Steffen & Goerg, Sebastian J. & Kube, Sebastian & Wibral, Matthias, 2011. "Equity and Efficiency in Multi-Worker Firms: Insights from Experimental Economics," IZA Discussion Papers 5727, Institute of Labor Economics (IZA).

    More about this item

    JEL classification:

    • M52 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Compensation and Compensation Methods and Their Effects
    • M5 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics
    • J3 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs
    • J5 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ehl:lserod:25423. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: LSERO Manager (email available below). General contact details of provider: https://edirc.repec.org/data/lsepsuk.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.