Performance Pay and the Erosion of Worker Cooperation : Field Experimental Evidence

@inproceedings{Burks2006PerformancePA,
  title={Performance Pay and the Erosion of Worker Cooperation : Field Experimental Evidence},
  author={Stephen V. Burks and Jeffrey Carpenter and Lorenz Goette},
  year={2006}
}
We report the results of a field experiment with bicycle messengers in Switzerland and the United States. Messenger work is individualized enough that firms can choose to condition pay on it, but significant externalities in messenger behavior nonetheless give their on-the-job interactions the character of a social dilemma. Firms therefore suffer efficiency losses when messengers fail to cooperate. Second-mover behavior in our sequential Prisoner’s Dilemma allows us to characterize the… CONTINUE READING
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