Bakó, Barna and Kálecz-Simon, András (2016) Quota bonuses as localized sales bonuses. Working Paper. Corvinus University of Budapest Faculty of Economics.
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Abstract
Managerial bonus schemes and their effects on firm strategies and market outcomes are extensively discussed in the literature. Though quota bonuses are not uncommon in practice, they have not been analysed so far. In this article we compare quota bonuses to profit-based evaluation and sales (quantity) bonuses. In a duopoly setting with independent demand shocks we find that under certain circumstances choosing quota bonuses is a dominant strategy. This may explain the widespread use of quota bonuses in situations where incentive problems are relevant.
| Item Type: | Monograph (Working Paper) |
|---|---|
| Series Name: | Corvinus Economics Working Papers - CEWP |
| Series Number / Identification Number: | 2016/01 |
| Uncontrolled Keywords: | strategic delegation, oligopoly, managerial incentives |
| JEL classification: | C73 - Stochastic and Dynamic Games; Evolutionary Games; Repeated Games D21 - Firm Behavior: Theory D43 - Market Structure and Pricing: Oligopoly and Other Forms of Market Imperfection L13 - Oligopoly and Other Imperfect Markets |
| Divisions: | Faculty of Economics > Department of Microeconomics |
| Subjects: | Economics |
| Funders: | MTA-BCE Lendület Stratégiai Interakciók Kutatócsoport |
| Projects: | MTA-BCE Lendület Stratégiai Interakciók Kutatócsoport |
| References: | |
| ID Code: | 2180 |
| Deposited By: | Barna Bakó |
| Deposited On: | 04 Jan 2016 08:38 |
| Last Modified: | 04 Jun 2021 15:34 |
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