In this study we examine whether increasing targets based on past performance information or on exogenous information affects employees' trade-off between short-term output and long-term investments differently. Both mechanism are supposed to increase long-term investments, while also achieving...

Tournament incentives are common in organizations, and how characteristics of the tournament group (e.g., tournament group identity) and the tournament incentives (e.g., winner proportion) affect tournament performance are of both practical and theoretical importance. We conduct two experiments...

We model relative performance evaluation (RPE) when a Chief Executive Officer (CEO) has the power to opportunistically influence the design of RPE by choosing the weight on an index-based peer group or by customizing the selection of peers comprising a peer group. A powerful CEO compares the...

This study investigates how formal control systems and the behavior of peers influence behavior in accounting settings. We manipulate formal controls and peer behavior (social norms) in a laboratory experiment, allowing us to precisely investigate the interactive effect of these two factors on...

We study the role of explicit and implicit incentives in a competitive labor market with no internal promotion opportunities. We find that explicit incentives explain only a small fraction of the total incentives, as the likelihood of new employment and renegotiation of current employment on...

In this paper, I examine the complementarity of performance measurement, performance pay for production workers, and delegation of decisions to production workers in German manufacturing. I argue and find that combining the three management practices yields higher financial performance than the...

This study examines how control elements of a firm affect managerial decision making. The firm operates a network of 59 profit centers. It uses a transfer-pricing system designed to deal with externalities individual profit centers can impose on other profit centers. Further, profit center...