Profit sharing: Consequences for workers
Authors: Tony Fang
Overview
Abstract (English)
Profit sharing can lead to higher productivity and thus to higher firm profitability and employee wages. It may also enhance employment stability by enabling firms to adjust wages during downturns rather than lay off workers. While adoption of profit sharing increases earnings fluctuations, it also increases earnings growth in the longer term. As with any group incentive plan, profit sharing may result in some workers benefiting from the effort of others without themselves exerting greater effort (“free-rider problem”). However, there is evidence that in team-based production workplaces, profit sharing may reduce shirking and thus contribute to productivity growth.
Abstract (French)
Please note that abstracts only appear in the language of the publication and might not have a translation.
Details
| Type | Journal article |
|---|---|
| Author | Tony Fang |
| Publication Year | 2016 |
| Title | Profit sharing: Consequences for workers |
| Volume | 225 |
| Journal Name | IZA World of Labour |
| Pages | 10-Jan |
| Publication Language | English |
- Tony Fang
- Tony Fang
- Profit sharing: Consequences for workers
- IZA World of Labour
- 225
- 2016
- 10-Jan