Is performance-related pay schemes positively influence productivity?

Tutor's Answer

(Top Tutor) Studyfaq Tutor
Studies in the 1990’s tend to show a positive association between performance-related pay schemes and productivity. Many studies have examined the effect of performance pay on the productivity of their workers. One study involving a US shoe company investigated the change in productivity when they switched from performance related pay to an hourly rate. They found that productivity (measured by the average monthly shoes produced per day) fell by 6%. This further backs up the claim that performance-related pay motivates employees to work more, however, the impact on the businesses profitability cannot be accurately measured due to higher costs...
Completed Work