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Country-Compatible Incentive Design

Author

Listed:
  • Marjaana Gunkel
  • Edward J. Lusk
  • Birgitta Wolff

Abstract

Today’s management faces the challenge of employing workforces in different countries. Institutional frameworks, both formal and informal, in various countries influence employees’ preferences related to performance rewards and management styles. We conduct an empirical study to examine employees of a German multinational corporation at its locations in China, Germany, Japan, and the U.S. We find that employees from these countries have different preferences on incentives and management styles. Therefore, motivational mechanisms designed for one country might not work in others. We also find that the logic of diminishing marginal utility applies to most performance rewards.

Suggested Citation

  • Marjaana Gunkel & Edward J. Lusk & Birgitta Wolff, 2009. "Country-Compatible Incentive Design," Schmalenbach Business Review (sbr), LMU Munich School of Management, vol. 61(3), pages 290-309, July.
    • Handle: RePEc:sbr:abstra:v:61:y:2009:i:3:p:290-309
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    Citations

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    Cited by:

    1. Carolan McLarney & James Hansen, 2016. "Influences on Employee Reward Strategies in International Organizations," Proceedings of International Academic Conferences 3305200, International Institute of Social and Economic Sciences.
    2. Robert Rybnicek & Sabine Bergner & Alfred Gutschelhofer, 2019. "How individual needs influence motivation effects: a neuroscientific study on McClelland’s need theory," Review of Managerial Science, Springer, vol. 13(2), pages 443-482, April.

    More about this item

    Keywords

    Incentive Compensation; Institutional Frameworks; Management Style; Motivation; Performance Rewards;
    All these keywords.

    JEL classification:

    • M12 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Personnel Management; Executives; Executive Compensation
    • M16 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - International Business Administration
    • M52 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Compensation and Compensation Methods and Their Effects

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