Incentives, Job Satisfaction and Performance: Empirical Evidence in Italian Social Enterprises

49 Pages Posted: 3 Nov 2010

See all articles by Sara Depedri

Sara Depedri

European Research Institute on Cooperative & Social Enterprises (EURICSE); University of Trento

Ermanno C. Tortia

University of Trento - Department of Economics and Management; Euricse

Maurizio Carpita

ex Department of Quantitative Methods; University of Brescia - Department of Economics and Management

Date Written: October 1, 2010

Abstract

The paper offers a contribution to the understanding of the relations between incentives, satisfaction and performance of employees in social enterprises. It starts by criticizing the general hypotheses of the principal-agent theory and especially that employee satisfaction is determined exclusively by the level of salary received. These criticisms are explained both by looking to the organizational definition of job satisfaction by Locke and by taking a behavioural economics perspective. Job satisfaction is thus assumed to derive from a composed mix of incentives received on the job, equity perceived and employee motivations. It is no longer possible to assume that the wage is the sole (not even the most important) variable influencing worker performance. This claim is especially valid in social enterprises, where worker performance is difficult to monitor and evaluate, while high intrinsic motivations can better explain job satisfaction.

The empirical analysis helps to shed light on the determinants of job satisfaction and individual performance. Data was collected on 4,134 employees working in 320 Italian social cooperatives. The paper introduces the methodologies of categorical principal components analysis, factor analysis, and Rasch models to group the items of intrinsic and extrinsic satisfaction, motivations and fairness. The data was then analysed by means of linear regression where the dependent variables are not only the stated degree of job satisfaction, but also satisfaction with extrinsic and intrinsic aspects of the job. The models come to demonstrate the particular relevance of employee motivations and fairness perceived in explaining job satisfaction and its sub-dimensions. Furthermore, organizational perceptions and the work environment are found to be significant as are individual perceptions and motivations.

Keywords: job satisfaction, motivations, fairness, social cooperatives, Rasch models

JEL Classification: C21, C49, J24, M54

Suggested Citation

Depedri, Sara and Tortia, Ermanno C. and Carpita, Maurizio and Carpita, Maurizio, Incentives, Job Satisfaction and Performance: Empirical Evidence in Italian Social Enterprises (October 1, 2010). Euricse Working Papers No. 012|10, Available at SSRN: https://ssrn.com/abstract=1698598 or http://dx.doi.org/10.2139/ssrn.1698598

Sara Depedri (Contact Author)

European Research Institute on Cooperative & Social Enterprises (EURICSE) ( email )

Via S. Giovanni 36
38122 Trento (TN)
Italy

University of Trento

Via Giuseppe Verdi 26
Trento, Trento 38152
Italy

Ermanno C. Tortia

University of Trento - Department of Economics and Management ( email )

Via Inama, 5
Trento, TN Trento 38122
Italy
00390461882383 (Phone)
00390461882222 (Fax)

HOME PAGE: http://www.unitn.it

Euricse ( email )

Via Torre Verde, 5
38122 Trento (TN), TN 38122
Italy

HOME PAGE: http://www.europee.eu

Maurizio Carpita

University of Brescia - Department of Economics and Management ( email )

Contrada S. Chiara, 50
Brescia, BS 25122
Italy
+39 030 2988642 (Phone)

ex Department of Quantitative Methods ( email )

Contrada S. Chiara 50
Brescia, BS 25122
Italy
+39 0302988642 (Phone)
+39 0302400925 (Fax)

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