Literature review compares individual and collective performance pay systems, suggesting implications for resource allocation and motivation.
The key to optimize resource allocation in enterprises is the management of compensation and performance. With the arrival of the digital economy, different industries have optimized and innovated human resource management to varying degrees, and compensation and performance are directly linked to employee work results. The debate on whether performance-related pay can improve organizational performance has been focused on individual performance-based pay systems, which generate differential incentives for individual performance through different pay systems. In this paper, a comparative study is conducted with collective performance-based pay systems (e.g., team bonuses and profit sharing) through a systematic literature review approach. On this basis, this review contributes to our understanding of categorization effects and free-riding under collective performance-based pay systems and whether financial incentives undermine intrinsic motivation.
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Yuhan Chen (2025) studied this question.
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