Journal of Population Economics

, Volume 23, Issue 1, pp 291–301 | Cite as

How performance related pay affects productivity and employment

  • Anne C. Gielen
  • Marcel J. M. Kerkhofs
  • Jan C. van Ours
Open Access
Original Paper


This paper uses information from a panel of Dutch firms to investigate the labor productivity effects of performance related pay (PRP). We find that PRP increases productivity at the firm level with 9% and employment growth with 5%.


Performance related pay Labor productivity 

JEL Classifications

C41 H55 J64 J65 


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Copyright information

© The Author(s) 2009

Authors and Affiliations

  • Anne C. Gielen
    • 1
    • 7
    • 8
  • Marcel J. M. Kerkhofs
    • 2
    • 3
  • Jan C. van Ours
    • 3
    • 4
    • 5
    • 6
    • 7
  1. 1.Department of EconomicsMaastricht UniversityMaastrichtThe Netherlands
  2. 2.OSA Institute for Labor StudiesTilburgThe Netherlands
  3. 3.Department of EconomicsTilburg UniversityTilburgThe Netherlands
  4. 4.CentER, Department of EconomicsTilburgThe Netherlands
  5. 5.Department of EconomicsUniversity of MelbourneVictoriaAustralia
  6. 6.CEPRLondonUnited Kingdom
  7. 7.IZABonnGermany
  8. 8.ROA Research Centre for Education and the Labour MarketMaastrichtThe Netherlands

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