Performance Pay and Wage Inequality*

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چکیده

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Higher and higher? Performance pay and wage inequality in Germany

Performance pay is of growing importance to the wage structure as it applies to a rising share of employees. At the same time wage dispersion is growing continuously. This leads to the question of how the growing use of performance pay schemes is related to the increase in wage inequality? German SOEP data for the years 1984 to 2009 confirm the large increase in the application of performance p...

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Online Appendix for the article: Higher and higher? Performance pay and wage inequality in Germany

End-point correction " Performance pay jobs " are defined as jobs that have paid for performance at least once in the past. Thus, job matches that are observed over a longer period are more likely to be observed as PP jobs. For this reason, job matches that are observed at the beginning of the observation period in 1984 may be misclassified as non-PP jobs if they paid for performance before 198...

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Performance pay or redistribution? Cultural differences in just-world beliefs and preferences for wage inequality

We identify and test a specific psychological mechanism underlying cross-national differences in preferences for performance-based versus redistributive compensation systems. We posit that individuals’ beliefs in the inherent justness and deservedness of individual outcomes (i.e., just world beliefs: JWBs) can help explain individual and culture-level variation in preferences for these compensa...

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Does ‘Performance Pay’ Pay? Wage Flexibility over the Great Recession

Using the National Compensation Survey between 2004-2014, we document substantial cyclical heterogeneity among performance pay and fixed wage jobs. We find that employment growth in performance pay (fixed wage) jobs is countercyclical (procyclical), whereas compensation per employee growth is procyclical (countercyclical). Our estimates are identified off the response of similar work levels wit...

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ژورنال

عنوان ژورنال: Quarterly Journal of Economics

سال: 2009

ISSN: 0033-5533,1531-4650

DOI: 10.1162/qjec.2009.124.1.1