Charness, Gary; Cobo-Reyes, Ramon; Jimenez, Natalia; … - In: American Economic Review 102 (2012) 5, pp. 2358-79
This paper analyzes the effect on performance and earnings of delegating the wage choice to employees. Our results show that such delegation significantly increases effort levels. Moreover, we observe a Pareto improvement, as the earnings of both employers and employees increase when employers...