The role of employee incentive pay in the competitiveness of family and non-family firms

Damiani, Mirella and Pompei, Fabrizio and Ricci, Andrea (2018): The role of employee incentive pay in the competitiveness of family and non-family firms. Published in: Economia Politica (15 November 2018)

Abstract

Insufficient attention has been paid to the different roles of wage incentives in the competitiveness of family and non-family firms. This paper addresses this issue and uses a sample of listed and non-listed Italian firms for 2007 and 2010 to show that family firms that adopt incentive wages obtain greater gains in competitiveness with respect to non-family firms. Unlike what occurs in non-family firms, the efficiency enhancing effect of incentive wages more than compensates for the premiums paid to employees and enables family firms to achieve significant gains in terms of competitiveness.

• Item Type: MPRA Paper
• Language: English
• Keywords: Family firms Performance-related pay Labour productivity Wages Competitiveness
• Subjects: D - Microeconomics > D2 - Production and Organizations > D24 - Production ; Cost ; Capital ; Capital, Total Factor, and Multifactor Productivity ; Capacity; G - Financial Economics > G3 - Corporate Finance and Governance > G32 - Financing Policy ; Financial Risk and Risk Management ; Capital and Ownership Structure ; Value of Firms ; Goodwill; J - Labor and Demographic Economics > J3 - Wages, Compensation, and Labor Costs > J33 - Compensation Packages ; Payment Methods

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