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Performance pay and unemployment during the great recession

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  • Parent, Daniel

Abstract

With data from the Panel Study of Income Dynamics I show that individuals in performance pay jobs were much less likely to be unemployed at the time of the interview than those in “fixed” wage jobs during the 2008 recession. While their unemployment rate is always lower in non-recession years, there is little evidence that this association was any weaker during the recession. Additional evidence shows that performance pay has a similar effect on the incidence of layoffs vs quits in both non-recession and recession years.

Suggested Citation

  • Parent, Daniel, 2015. "Performance pay and unemployment during the great recession," Economics Letters, Elsevier, vol. 126(C), pages 31-34.
    • Handle: RePEc:eee:ecolet:v:126:y:2015:i:c:p:31-34
    DOI: 10.1016/j.econlet.2014.11.011
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    References listed on IDEAS

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    1. Canice Prendergast, 1999. "The Provision of Incentives in Firms," Journal of Economic Literature, American Economic Association, vol. 37(1), pages 7-63, March.
    2. Chamberlain, Gary, 1984. "Panel data," Handbook of Econometrics, in: Z. Griliches† & M. D. Intriligator (ed.), Handbook of Econometrics, edition 1, volume 2, chapter 22, pages 1247-1318, Elsevier.
    3. Charles Brown, 1990. "Firms' Choice of Method of Pay," ILR Review, Cornell University, ILR School, vol. 43(3), pages 165-1-182-, April.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Unemployment; Performance pay; Recession;
    All these keywords.

    JEL classification:

    • J6 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers
    • J3 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs

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