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- Title
Impact of variable risk preferences on the effectiveness of control by pay.
- Authors
Deckop, John R.; Merriman, Kimberly K.; Blau, Gary
- Abstract
Pay for performance is an organizational control mechanism intended to align the interests of employer and employee. We investigated whether employee risk preference interferes with the effects of this 'control by pay' on attitudinal and behavioural outcomes. We found that the degree of consistency between risk preference and control by pay affected withdrawal intentions, contingent pay satisfaction and organizational citizenship behaviour, as hypothesized. The results suggest that the use of pay for performance as a control mechanism should take into account employee risk preference, and that this concern should apply broadly in the organization, not just at the executive level.
- Subjects
PAY for performance; PERFORMANCE awards; MONETARY incentives; MERIT ratings; INDUSTRIAL psychology
- Publication
Journal of Occupational & Organizational Psychology, 2004, Vol 77, Issue 1, p63
- ISSN
0963-1798
- Publication type
Article
- DOI
10.1348/096317904322915919