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Economics Faculty Publications
Motivation; Wage & salary administration; Pay structure; Wages & salaries
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Full-Text Articles in Labor Relations
Motivating With Efficiency Wages And Delayed Payments, Kevin F. Hallock
Motivating With Efficiency Wages And Delayed Payments, Kevin F. Hallock
Economics Faculty Publications
In the delayed payment system, companies motivate workers to work hard year after year by paying them less than the value they create for the company early in the workers' tenure and more than the value they create for the company later in the workers' tenure. With efficiency wages, workers are essentially paid a wage that is higher than the next-best offer they could get. A paper by Alan Krueger found that at company-owned fast food restaurants, employee compensation is higher and the delayed payment profile is steeper than at franchised outlets. In a recent paper, Matthew Freedman and Renata …