Arbeitspapier

Managerial incentives and favoritism in promotion decisions: Theory and field evidence

This paper investigates the effects of managerial incentives on favoritism in promotion decisions. First, we theoretically show that favoritism leads to a lower quality of promotion decisions and in turn lower efforts. But the effect can be mitigated by pay-for-performance incentives for managers who decide upon promotion. Second, we analyze matched employer-employee survey data with detailed firm level information on managerial incentive schemes and find that perceived promotion quality is indeed substantially higher when managers receive performance-related pay or participate in gain sharing plans.

Sprache
Englisch

Erschienen in
Series: IZA Discussion Papers ; No. 5543

Klassifikation
Wirtschaft
Compensation Packages; Payment Methods
Personnel Economics: Firm Employment Decisions; Promotions
Personnel Economics: Compensation and Compensation Methods and Their Effects
Personnel Economics: Labor Management
Labor Discrimination
Thema
incentives
favoritism
nepotism
tournaments
Erwerbsverlauf
Personalauswahl
Führungskräfte
Patronage
Leistungsentgelt
Extensives Spiel
Theorie
Feldforschung

Ereignis
Geistige Schöpfung
(wer)
Berger, Johannes
Herbertz, Claus
Sliwka, Dirk
Ereignis
Veröffentlichung
(wer)
Institute for the Study of Labor (IZA)
(wo)
Bonn
(wann)
2011

Handle
URN
urn:nbn:de:101:1-201104133606
Letzte Aktualisierung
20.09.2024, 08:24 MESZ

Objekttyp

  • Arbeitspapier

Beteiligte

  • Berger, Johannes
  • Herbertz, Claus
  • Sliwka, Dirk
  • Institute for the Study of Labor (IZA)

Entstanden

  • 2011

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