Scandinavian Working Papers in Economics
HomeAboutSeriesSubject/JEL codesAdvanced Search
The Economic Research Institute, Stockholm School of Economics SSE/EFI Working Paper Series in Economics and Finance

No 245:
Monitoring and Pay

Magnus Allgulin and Tore Ellingsen ()

Abstract: The shirking model of efficiency wages has been thought to imply that monitoring and pay are substitute instruments for motivating workers. We demonstrate that this result hinges critically on restrictive assumptions regarding workers' choice of effort - for example that there are only two possible effort levels. Under more reasonable assumptions, monitoring and pay are complementary instruments. Another result is that there is a non-monotonic relationship between the wage level and the workers' rents. Finally, much of the empirical literature on the monitoring-pay relationship is shown to be seriously misguided.

Keywords: Monitoring; efficiency wages; incentive pay.; (follow links to similar papers)

JEL-Codes: J31; J41; (follow links to similar papers)

24 pages, June 16, 1998, Revised November 22, 1999

Before downloading any of the electronic versions below you should read our statement on copyright.
Download GhostScript for viewing Postscript files and the Acrobat Reader for viewing and printing pdf files.

Full text versions of the paper:

hastef0245.rev.pdf.zip    PDF-file (zipped) (271kB) 
hastef0245.rev.pdf    PDF-file (458kB) 
hastef0245.rev.ps.zip    PKZipped PostScript (269kB) 
hastef0245.rev.ps    PostScript file (1006kB) 
Download Statistics

Questions (including download problems) about the papers in this series should be directed to Helena Lundin ()
Report other problems with accessing this service to Sune Karlsson () or Helena Lundin ().

Programing by
Design by Joachim Ekebom

Handle: RePEc:hhs:hastef:0245 This page was generated on 2014-12-14 19:22:55