Performance related pay, productivity and wages in Italy: a quantile regression approach
The authors analyzed the role of Performance Related Pay (PRP) in a sample of Italian manufacturing and service firms and presented standard quantile estimates to investigate heterogeneity in pay-performance impacts on labor productivity and wages. In a second stage, the endogeneity of PRP was taken into account by using instrumental variable quantile regression techniques. They find considerable heterogeneity across the distribution of labor productivity and wages, with the highest role of PRP obtained at the lowest and highest quantiles. However, for all quantiles, the comparison of productivity and wage estimates suggests that PRP might not only be rent-sharing devices, but also incentive schemes that substantially lead to efficiency enhancements. These findings are confirmed for firms under union governance and suggest that well designed policies, that circumvent the limited implementation of PRP practices, would guarantee productivity improvement.
|Date of creation:||30 Jan 2014|
|Date of revision:|
|Contact details of provider:|| Postal: |
Web page: https://mpra.ub.uni-muenchen.de
More information through EDIRC
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.:
- Michel Dumont & Glenn Rayp & Peter Willemé, 2006. "Does internationalization affect union bargaining power? An empirical study for five EU countries," Oxford Economic Papers, Oxford University Press, vol. 58(1), pages 77-102, January.
- Douglas L. Kruse & Richard B. Freeman & Joseph R. Blasi, 2010. "Shared Capitalism at Work: Employee Ownership, Profit and Gain Sharing, and Broad-based Stock Options," NBER Books, National Bureau of Economic Research, Inc, number krus08-1, December.
- Origo, Federica, 2009. "Flexible pay, firm performance and the role of unions. New evidence from Italy," Labour Economics, Elsevier, vol. 16(1), pages 64-78, January.
- John A. Abowd & Thomas Lemieux, 1993.
"The Effects of Product Market Competition on Collective Bargaining Agreements: The Case of Foreign Competition in Canada,"
The Quarterly Journal of Economics,
Oxford University Press, vol. 108(4), pages 983-1014.
- John M. Abowd & Thomas Lemieux, 1991. "The Effects of Product Market Competition on Collective Bargaining Agreements: The Case of Foreign Competition in Canada," NBER Working Papers 3808, National Bureau of Economic Research, Inc.
- Gielen, A. C. & Kerkhofs, M.J.M. & van Ours, J.C., 2010.
"How performance related pay affects productivity and employment,"
Other publications TiSEM
214b2f4b-76bc-4e3a-b936-d, Tilburg University, School of Economics and Management.
- Anne Gielen & Marcel Kerkhofs & Jan Ours, 2010. "How performance related pay affects productivity and employment," Journal of Population Economics, Springer, vol. 23(1), pages 291-301, January.
- Daron Acemoglu & Jorn-Steffen Pischke, 1998.
"Beyond Becker: Training in Imperfect Labor Markets,"
NBER Working Papers
6740, National Bureau of Economic Research, Inc.
- Acemoglu, Daron & Pischke, Jorn-Steffen, 1999. "Beyond Becker: Training in Imperfect Labour Markets," Economic Journal, Royal Economic Society, vol. 109(453), pages F112-42, February.
- Daron Acemoglu & Joern-Steffen Pischke, 1998. "Beyond Becker: Training in Imperfect Labor Markets," Working papers 98-12, Massachusetts Institute of Technology (MIT), Department of Economics.
- Victor Chernozhukov & Christian Hansen, 2005. "An IV Model of Quantile Treatment Effects," Econometrica, Econometric Society, vol. 73(1), pages 245-261, 01.
- Pedro S. Martins, 2008.
"Rent Sharing Before and After the Wage Bill,"
12, Queen Mary, University of London, School of Business and Management, Centre for Globalisation Research.
- Pedro S. Martins, 2004. "Rent Sharing Before and After the Wage Bill," Discussion Paper Series, Department of Economics 200405, Department of Economics, University of St. Andrews.
- Martins, Pedro S., 2004. "Rent Sharing Before and After the Wage Bill," IZA Discussion Papers 1376, Institute for the Study of Labor (IZA).
- Zwick, Thomas, 2004. "Employee participation and productivity," Labour Economics, Elsevier, vol. 11(6), pages 715-740, December.
- Roland Benabou & Jean Tirole, 2003.
"Intrinsic and Extrinsic Motivation,"
Review of Economic Studies,
Wiley Blackwell, vol. 70(3), pages 489-520, 07.
- Dr Alex Bryson & John Forth, 2010.
"Trade Union Membership and Influence 1999-2009,"
NIESR Discussion Papers
362, National Institute of Economic and Social Research.
- Frölich, Markus & Melly, Blaise, 2008.
"Unconditional Quantile Treatment Effects under Endogeneity,"
IZA Discussion Papers
3288, Institute for the Study of Labor (IZA).
- Markus FrÃ¶lich & Blaise Melly, 2013. "Unconditional Quantile Treatment Effects Under Endogeneity," Journal of Business & Economic Statistics, Taylor & Francis Journals, vol. 31(3), pages 346-357, July.
- Markus Frölich & Blaise Melly, 2007. "Unconditional quantile treatment effects under endogeneity," CeMMAP working papers CWP32/07, Centre for Microdata Methods and Practice, Institute for Fiscal Studies.
- Mas, Alexandre & Moretti, Enrico, 2006.
"Peers at Work,"
IZA Discussion Papers
2292, Institute for the Study of Labor (IZA).
- repec:oup:qjecon:v:108:y:1993:i:4:p:983-1014 is not listed on IDEAS
- Edward P. Lazear, 2000.
"Performance Pay and Productivity,"
American Economic Review,
American Economic Association, vol. 90(5), pages 1346-1361, December.
- Sandra E. Black & Lisa M. Lynch, 2001.
"How To Compete: The Impact Of Workplace Practices And Information Technology On Productivity,"
The Review of Economics and Statistics,
MIT Press, vol. 83(3), pages 434-445, August.
- S. Black & L. Lynch, 1997. "How to compete: the impact of workplace practices and information technology on productivity," LSE Research Online Documents on Economics 20298, London School of Economics and Political Science, LSE Library.
- Lisa M Lynch & Sandra E Black, 2002. "How to Compete: The Impact of Workplace Practices and Information Technology on Productivity," Working Papers 02-04, Center for Economic Studies, U.S. Census Bureau.
- S Black & L Lynch, 1997. "How to Compete: The Impact of Workplace Practices and Information Technology on Productivity," CEP Discussion Papers dp0376, Centre for Economic Performance, LSE.
- Sandra E. Black & Lisa M. Lynch, 1997. "How to Compete: The Impact of Workplace Practices and Information Technology on Productivity," NBER Working Papers 6120, National Bureau of Economic Research, Inc.
- Booth, Alison L & Frank, Jeff, 1999. "Earnings, Productivity, and Performance-Related Pay," Journal of Labor Economics, University of Chicago Press, vol. 17(3), pages 447-63, July.
- Oriana Bandiera & Iwan Barankay & Imran Rasul, 2010.
"Social Incentives in the Workplace,"
Review of Economic Studies,
Oxford University Press, vol. 77(2), pages 417-458.
- Kandel, Eugene & Lazear, Edward P, 1992.
"Peer Pressure and Partnerships,"
Journal of Political Economy,
University of Chicago Press, vol. 100(4), pages 801-17, August.
- Booth, Alison L & Chatterji, Monojit, 1998. "Unions and Efficient Training," Economic Journal, Royal Economic Society, vol. 108(447), pages 328-43, March.
- Canice Prendergast, 1999. "The Provision of Incentives in Firms," Journal of Economic Literature, American Economic Association, vol. 37(1), pages 7-63, March.
- Riccardo Leoni, 2012. "Workplace Design, Complementarities among Work Practices, and the Formation of Key Competencies: Evidence from Italian Employees," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 65(2), pages 316-349, April.
When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:53341. 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: (Ekkehart Schlicht)
If references are entirely missing, you can add them using this form.