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Human Resources Management

Compensation

Compensation Research Initiative

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Full-Text Articles in Labor Relations

The Relative Effects Of Merit Pay, Bonuses, And Long-Term Incentives On Future Job Performance (Cri 2009-009), Sanghee Park, Michael C. Sturman Jan 2009

The Relative Effects Of Merit Pay, Bonuses, And Long-Term Incentives On Future Job Performance (Cri 2009-009), Sanghee Park, Michael C. Sturman

Compensation Research Initiative

Extant compensation literature has indicated that pay-for-performance can influence employee performance. There is little research, however, that differentiates the effects of certain forms of pay-for-performance plans on future performance. By applying the precepts of expectancy theory to specific components of the pay-for-performance plans and using longitudinal data from a sample of 739 US employees in a service-related organization, this study demonstrates different effects for merit pay, bonuses, and long-term incentives.