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Performance Pay and Work-Related Health Problems

A Longitudinal Study of Establishments

Bibliographic Data

ID3734831
AuthorsJed Devaro (0000-0003-4849-1489, University of Wisconsin–Milwaukee, corresponding author), Antti Kauhanen (0000-0001-9506-1241), John S Heywood (0000-0001-9600-2462, Jed DeVaro is The Wang Family Professor, College of Business and Economics, California State University East Bay. John S. Heywood is Distinguished Professor in the Department of Economics at University of Wisconsin–Milwaukee.)
Year2017
Volume70
Issue3
Pages670-703
Publication date2017-05-01
Peer ReviewedYes
Open AccessYes
TypeARTICLE
VenueIndustrial and Labor Relations Review (JOURNAL)
Journal identifiersISSN: 0019-7939 • E-ISSN: 2162-271X
PublisherSAGE Publications Inc (PUBLISHER)
DOI10.1177/0019793916669148
OpenAlexW2518664017
LanguageEN
Citations received10
References cited57

Using panel data from 2004 and 2011, the authors find an elevated incidence of work-related ailments (associated with bones, muscles, and joints) in U.K. establishments that use individual performance pay, even after accounting for establishment fixed effects. Fixed-effect estimates also confirm a positive relationship between absence due to illness and performance pay. The elevated rates of ailments associated with performance pay appear to reduce financial performance and product quality, even though performance pay has a positive net influence on financial performance. Thus, a hidden cost of performance pay is occupational health deterioration. Parallel results are absent for labor productivity and, in a smaller sample, for profit

Actuarial science · Business · Demographic economics · Econometrics · Economic growth · Economics · Fixed cost · Fixed effects model · Health care · Incentive · Labour economics · Microeconomics · Panel data · Pay for performance · Performance-related pay · Product (mathematics) · Productivity · Profit (economics) · Quality (philosophy) · Sample (material) · Work (physics) · Work performance · Accounting · Employment and Welfare Studies · Engineering · Global Health Care Issues · Mathematics · Occupational Health and Safety Research

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Unique citing works10
Citations per year1,67
Citation span2020 - 2026 (7)
Citation velocitycurrent
Highly citedNo
Citation typesNeutral: 9

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