An incentive to increase laborers' productivity with adopting performance-based wages and paid vacations

Yui Nakamura (nakamuray@fukuoka-u.ac.jp)
Additional contact information
Yui Nakamura: Faculty of Economics, Fukuoka University

Economics Bulletin, 2011, vol. 31, issue 1, 1018-1024

Abstract: This paper shows that introducing a paid-vacation system tied to performance is effective in increasing the motivation of laborers to make effort and exercise high productivity. This effect is similar to the effects of implementing a performance-based wage system, on which many earlier papers have focused. We also found that the paid-vacation system can be particularly effective in companies where high-skilled laborers are required and labor hours are long. In addition, laborers' motivation can be greater when a company offers different performance-based compensation schemes, such as the performance-based system and the paid-vacation system, because each laborer has heterogeneous preference for leisure.

Keywords: paid vacation; performance-based wage; incentive; effort (search for similar items in EconPapers)
JEL-codes: D6 J3 (search for similar items in EconPapers)
Date: 2011-03-30
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.accessecon.com/Pubs/EB/2011/Volume31/EB-11-V31-I1-P95.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ebl:ecbull:eb-10-00178

Access Statistics for this article

More articles in Economics Bulletin from AccessEcon
Bibliographic data for series maintained by John P. Conley (j.p.conley@vanderbilt.edu).