The Cost of High-Powered Incentives: Employee Gaming in Enterprise Software Sales

Autor:	Ian Larkin
Rok vydání:	2014
Předmět:	Economics and Econometrics Labour economics business.industry Vendor Commission Price discrimination Incentive Industrial relations Revenue Closure (psychology) Robustness (economics) business Industrial organization Enterprise software
Zdroj:	Journal of Labor Economics. 32:199-227
ISSN:	1537-5307 0734-306X
Popis:	This article investigates the pricing distortions that arise from the use of a common nonlinear incentive scheme at a leading enterprise software vendor. The empirical results demonstrate that salespeople are adept at gaming the timing of deal closure to take advantage of the vendor's accelerating commission scheme. Specifically, salespeople agree to significantly lower pricing in quarters in which they have a financial incentive to close a deal, resulting in mispricing that costs the vendor 6%-8% of revenue. Robustness checks demonstrate that price discrimination by the vendor does not explain the identified effects.
Databáze:	OpenAIRE
Externí odkaz:	https://explore.openaire.eu/search/publication?articleId=doi_dedup___::00972d0436e9dae81cf5789954691684 https://doi.org/10.1086/673371 Zobrazit plný text záznamu Plný text ve formátu PDF Plný text ve formátu HTML
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