Long-term incentives for workers, such as promotion "tournaments" and pay increases that are larger than tenure increases, are the essence of personnel economics. However, empirical work on incentives lags far behind theoretical models. This talk considers evidence on incentives in large bureaucracies using several historical panel data sets. The suggestive results from this data are compared to some results in experimental labor markets. Finally, I consider the interplay between "fairness" and incentives.

References

Steffen Huck, Andrew Seltzer, and Brian Wallace. "Deferred Compensation in Multi-Period Labor Contracts: An Experimental Test of Lazear's Model", American Economic Review, 101, 2, forthcoming (April 2011).

Andrew Seltzer. "Did Firms Cut Nominal Wages in a Deflationary Environment?: Micro-Level Evidence from the Late 19th and early 20th Century Banking Industry", Explorations in Economic History, 47 (2010), pp. 112-125.

Andrew Seltzer and Jeff Frank. "Promotion Tournaments and White Collar Careers: Evidence from Williams Deacon's Bank, 1890 – 1941", Oxford Economic Papers, 59, 5 (2007), pp. i49-i72.

Andrew Seltzer and David Merrett. "Personnel Practices at the Union Bank of Australia: Panel Evidence from the 1887-1900 Entry Cohorts", Journal of Labor Economics, vol. 18, no. 4 (October 2000), pp. 573-613.