Abstract
This study used a sample of middle-level managers to investigate the effects of organization-level agency-theory-based variables on the proportion of variable compensation that managers receive. Level of task programmability was associated with an increased use of variable pay, and long-term relationships between an agent and principal were associated with decreased use. Results supported the classical organizationtheory prediction that under higher risk, organizations use higher proportions of variable pay; but results question agency theory's ability to predict compensation strategy for middle-level managers in the high-risk situation.
Original language | English (US) |
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Pages (from-to) | 751-767 |
Number of pages | 17 |
Journal | Academy of Management Journal |
Volume | 39 |
Issue number | 3 |
DOIs | |
State | Published - Jun 1996 |
ASJC Scopus subject areas
- Business and International Management
- Business, Management and Accounting(all)
- Strategy and Management
- Management of Technology and Innovation