The Choice of Payment Schemes: Australian Establishment Data

We use Australian establishment data to estimate the determinants of incentive schemes. Hypotheses are drawn from the new economics of personnel and the strategic choice literatures. Larger firms are more likely to use individual schemes such as piece rates. Firms where female workers predominate or those facing stiff product market competition are more likely to use both piece rates and profit sharing. We also isolate the effects of monitoring, job security, and industrial relations climate.