Do Financial Bonuses to Employees Reduce Their Absenteeism? Outcome of a Lottery
This paper investigates the effectiveness of a monthly lottery in reducing sick leave among workers in a manufacturing firm. Conditions of participation are not having reported sick in the previous three months and not having won the lottery earlier. It turns out that the lottery results in a decrease in the rate of sick leave of 1.6 percentage point. From the perspective of the firm, the lottery is found to be highly beneficial – that is, the benefits associated with the decrease in the sick leave rate exceed the costs of the lottery. Workers seem to be primarily driven by the first upcoming lottery. After winning the lottery, winners resume their previous (rate of) absence.
|Date of creation:||Jun 2005|
|Date of revision:|
|Publication status:||published in: Industrial and Labor Relations Review, 2009, 62 (3), 327 - 342|
|Contact details of provider:|| Postal: IZA, P.O. Box 7240, D-53072 Bonn, Germany|
Phone: +49 228 3894 223
Fax: +49 228 3894 180
Web page: http://www.iza.org
|Order Information:|| Postal: IZA, Margard Ody, P.O. Box 7240, D-53072 Bonn, Germany|
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Per Johansson & Mårten Palme, 2002.
"Assessing the Effect of Public Policy on Worker Absenteeism,"
Journal of Human Resources,
University of Wisconsin Press, vol. 37(2), pages 381-409.
- Johansson, Per & Palme, Mårten, 2001. "Assessing the effect of public policy on worker absenteeism," Working Paper Series 2002:13, IFAU - Institute for Evaluation of Labour Market and Education Policy.
- Barmby, Tim A. & Ercolani, Marco G. & Treble, John G., 2000.
"Sickness Absence: An International Comparison,"
IRISS Working Paper Series
2000-03, IRISS at CEPS/INSTEAD.
- Nicholas Wilson & Michael J. Peel, 1991. "The Impact on Absenteeism and Quits of Profit-Sharing and other Forms of Employee Participation," ILR Review, Cornell University, ILR School, vol. 44(3), pages 454-468, April.
- Magnus Henrekson & Mats Persson, 2004.
"The Effects on Sick Leave of Changes in the Sickness Insurance System,"
Journal of Labor Economics,
University of Chicago Press, vol. 22(1), pages 87-114, January.
- Henrekson, Magnus & Persson, Mats, 2001. "The Effects on Sick Leave of Changes in the Sickness Insurance System," SSE/EFI Working Paper Series in Economics and Finance 0444, Stockholm School of Economics, revised 08 Aug 2001.
- Henrekson, Magnus & Persson, Mats, 2001. "The Effects on Sick Leave of Changes in the Sickness Insurance System," Seminar Papers 697, Stockholm University, Institute for International Economic Studies.
- Barmby, Tim & Orme, Chris D & Treble, John, 1990.
"Worker Absenteeism: An Analysis Using Microdata,"
CEPR Discussion Papers
434, C.E.P.R. Discussion Papers.
- Shane Frederick & George Loewenstein & Ted O'Donoghue, 2002. "Time Discounting and Time Preference: A Critical Review," Journal of Economic Literature, American Economic Association, vol. 40(2), pages 351-401, June.
- Johansson, Per & Palme, Marten, 1996. "Do economic incentives affect work absence? Empirical evidence using Swedish micro data," Journal of Public Economics, Elsevier, vol. 59(2), pages 195-218, February.
- Rainer Winkelmann, 1999. "Wages, firm size and absenteeism," Applied Economics Letters, Taylor & Francis Journals, vol. 6(6), pages 337-341.
- Edward P. Lazear, 1996.
"Performance Pay and Productivity,"
NBER Working Papers
5672, National Bureau of Economic Research, Inc.
- George A. Akerlof & Rachel E. Kranton, 2005. "Identity and the Economics of Organizations," Journal of Economic Perspectives, American Economic Association, vol. 19(1), pages 9-32, Winter.
- Leigh, J. Paul, 1985. "The effects of unemployment and the business cycle on absenteeism," Journal of Economics and Business, Elsevier, vol. 37(2), pages 159-170, May.
- Chamberlain, Gary, 1982. "Multivariate regression models for panel data," Journal of Econometrics, Elsevier, vol. 18(1), pages 5-46, January.
- Arai, Mahmood & Skogman Thoursie, Peter, 2001.
"Incentives and Selection in Cyclical Absenteeism,"
Working Paper Series
167, Trade Union Institute for Economic Research.
- Allen, Steven G, 1981. "An Empirical Model of Work Attendance," The Review of Economics and Statistics, MIT Press, vol. 63(1), pages 77-87, February.
- Barmby, Tim & Orme, Chris & Treble, John, 1995. "Worker absence histories: a panel data study," Labour Economics, Elsevier, vol. 2(1), pages 53-65, March.
- Andrea Ichino & Regina T. Riphahn, 2001.
"The Effect of Employment Protection on Worker Effort. A Comparison of Absenteeism During and After Probation,"
CESifo Working Paper Series
596, CESifo Group Munich.
- Ichino, Andrea & Riphahn, Regina T., 2001. "The Effect of Employment Protection on Worker Effort: A Comparison of Absenteeism During and After Probation," IZA Discussion Papers 385, Institute for the Study of Labor (IZA).
- Ichino, Andrea & Riphahn, Regina, 2003. "The Effect of Employment Protection on Worker Effort: A Comparison of Absenteeism During and After Probation," CEPR Discussion Papers 3847, C.E.P.R. Discussion Papers.
- Kenyon, Peter & Dawkins, Peter, 1989. "A Time Series Analysis of Labour Absence in Australia," The Review of Economics and Statistics, MIT Press, vol. 71(2), pages 232-39, May.
- Dunn, L F & Youngblood, Stuart A, 1986. "Absenteeism as a Mechanism for Approaching an Optimal Labor Market Equilibrium: An Empirical Study," The Review of Economics and Statistics, MIT Press, vol. 68(4), pages 668-74, November.
- Doherty, N A, 1979. "National Insurance and Absence from Work," Economic Journal, Royal Economic Society, vol. 89(353), pages 50-65, March.
- Engellandt, Axel & Riphahn, Regina T., 2004. "Incentive Effects of Bonus Payments: Evidence from an International Company," IZA Discussion Papers 1229, Institute for the Study of Labor (IZA).
- Kaivanto, Kim, 1997. "An alternative model of pro-cyclical absenteeism," Economics Letters, Elsevier, vol. 54(1), pages 29-34, January.
- Robert Drago & Mark Wooden, 1992. "The Determinants of Labor Absence: Economic Factors and Workgroup Norms across Countries," ILR Review, Cornell University, ILR School, vol. 45(4), pages 764-778, July.
When requesting a correction, please mention this item's handle: RePEc:iza:izadps:dp1644. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Mark Fallak)
If references are entirely missing, you can add them using this form.