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The Dispersion of Bonus Payments within and between Firms

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  • Grund, Christian

    (RWTH Aachen University)

  • Hofmann, Tanja

    (RWTH Aachen University)

Abstract

We explore the dispersion of bonus payments of managers within and between five large firms from the German chemical sector. We use data from a yearly salary survey in these firms during the observation period 2008 to 2013. Bonus payments account for 20 percent of base salaries on average. Both the amount and the dispersion of bonus-to-base ratios differ across firms. We disentangle the dispersion between and within the levels of firms' hierarchies. Revealed differences are consistent with differences in firms' value statements.

Suggested Citation

  • Grund, Christian & Hofmann, Tanja, 2017. "The Dispersion of Bonus Payments within and between Firms," IZA Discussion Papers 10642, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp10642
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    3. Grund, Christian & Soboll, Alexandra, 2023. "Monetary Rewards, Hierarchy Level and Working Hours as Drivers of Employees' Self-Evaluations," IZA Discussion Papers 16042, Institute of Labor Economics (IZA).

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    More about this item

    Keywords

    pay policies; firm differences; bonus to base rate; bonus payments; wage dispersion;
    All these keywords.

    JEL classification:

    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J33 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Compensation Packages; Payment Methods
    • M52 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Compensation and Compensation Methods and Their Effects

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