The Welfare Effects of Incentive Schemes
计算了支票清算行业一家企业引入激励方案后的福利变化，发现激励使生产率提高12%，但工人努力成本相当于7%的生产率提升，净福利增加5%。
This paper computes the change in welfare associated with the introduction of incentives. Specifically, we calculate by how much the welfare gains of increased output due to incentives outweigh workers ’ disutility from increased effort. We accomplish this by studying the use of incentives by a firm in the check-clearing industry. Using this firm’s production records, we model and estimate the worker’s dynamic effort decision problem. We find that the firm’s incentive scheme has a large effect on productivity, raising it by 12 % over the sample period. Using our parameter estimates, we show that the cost of increased effort due to incentives is equal to the dollar value of a 7 % rise in productivity. Welfare is measured as the output produced minus the cost of effort, hence the net increase in welfare due to the introduction of the firm’s bonus plan is 5%. Under a first-best scheme, we find that the net increase in welfare is 6%. ∗We would like to thank Tom Holmes for his advice and encouragement. We also thank Zvi Eckstein, Gautam Gowrisankaran, Matt Mitchell, and Andrea Moro for their helpful comments. In addition, this paper has benefited from participants at numerous seminars. Finally, we thank Jon Stam and Deb Rahn for their assistance in gathering the data and answering our questions about check processing. This paper is based on the first part of Adam Copeland’s University of Minnesota Ph.D. disseration and much of it was written while both authors were Research Associates at the Federal Reserve Bank of Minneapolis. The views expressed herein are those of the authors and not necessarily those of the European Central Bank, the Eurosystem, the Federal Reserve Bank of Minneapolis, or the Federal