Article ID Journal Published Year Pages File Type
5067703 European Economic Review 2007 26 Pages PDF
Abstract

We consider the response to incentives as an explanation for observed productivity differences within a firm that paid its workers piece rates. We provide a framework within which the observed productivity differences can be decomposed into two parts: One due to differences in ability and the other due to differences in the response to incentives. We apply this decomposition to male and female workers from a tree-planting firm in British Columbia, Canada. Our evidence (both experimental and nonexperimental) suggests that there was no difference in the reaction to incentives between male and female planters. The productivity differential male planters enjoyed arose because of differences in ability, interpreted as strength in our application.

Related Topics
Social Sciences and Humanities Economics, Econometrics and Finance Economics and Econometrics
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