Profit Sharing and Gainsharing: A Review of Theory

Levy Economics Institute Working Paper No. 125

32 Pages Posted: 10 Oct 1998  

Derek C. Jones

Hamilton College - Economics Department

Takao Kato

Colgate University - Economics Department; IZA Institute of Labor Economics

Jeffrey L. Pliskin

Hamilton College; The Levy Economics Institute

Date Written: September 1994

Abstract

The slowdown in productivity growth since the 1970s has led to increased interest in alternative compensation schemes such as profit sharing and gain sharing that might raise worker productivity and reduce turnover. In this working paper, Jones, Kato, and Pliskin summarize the rise in popularity of profit sharing (PS) and gain sharing (GS) plans; review existing theoretical and empirical work on PS and GS; and highlight findings that relate the effectiveness of such programs at raising productivity and enhancing employment stability. They also note that some existing studies contain some econometric problems relating to plan and model variables; there are measurement problems as well. Their paper primarily focuses on PS plans.

JEL Classification: J24, J33

Suggested Citation

Jones, Derek C. and Kato, Takao and Pliskin, Jeffrey L., Profit Sharing and Gainsharing: A Review of Theory (September 1994). Levy Economics Institute Working Paper No. 125. Available at SSRN: https://ssrn.com/abstract=101593 or http://dx.doi.org/10.2139/ssrn.101593

Derek C. Jones (Contact Author)

Hamilton College - Economics Department ( email )

198 College Hill Road
Clinton, NY 13323
United States
315-859-4381 (Phone)
315-859-4477 (Fax)

Takao Kato

Colgate University - Economics Department ( email )

13 Oak Drive
Hamilton, NY 13346
United States
315-228-7562 (Phone)
315-228-7033 (Fax)

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Jeffrey L. Pliskin

The Levy Economics Institute

Blithewood
Annandale-on-Hudson, NY 12504
United States

Hamilton College ( email )

198 College Hill Road
Clinton, NY 13323
United States
315-859-4143 (Phone)

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