Performance Based Incentives for Military Recruiters: Evidence from the U.S. Navy
نویسندگان
چکیده
Economic theory suggests that the use of flat-rate compensation for military recruiters is sub-optimal. We elicited the preferences of U.S. Navy recruiters for a piece-rate compensation scheme, and find many would prefer a modest decrease in fixed salary in exchange for the opportunity to receive a small monetary bonus per high-quality recruit. Under such a bonus scheme, the Navy could hire fewer recruiters and thus lower recruiter personnel expenses by 14.7 percent per year (over $40 million) while maintaining quality standards. Furthermore, survey evidence suggests the current policy of awarding non-monetary compensation for job performance provides minimal incentive to increase output.
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