This paper reviews the field experimental evidence on firm-employee relationships. There is strong evidence that output rises in response to financial incentives, but more mixed support for worker reciprocity in response to employer generosity. Non-financial approaches, such as worker recognition or adding 'meaning' to mundane tasks, can also increase output. Social relations are central to how firms function and have been shown to have an important impact on the design of incentive schemes. What we do not know, however, far exceeds that which we have learned. A broad swathe of important topics, including recruiting, worker promotion, and training, are virtually untouched thus far by field experiments.

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Oxford Review of Economic Policy
Erasmus University Rotterdam

Levitt, S. D., & Neckermann, S. (2014). What field experiments have and have not taught us about managing workers. Oxford Review of Economic Policy, 30(4), 639–657. doi:10.1093/oxrep/grv003