American Economic Review Vol. 85 No. 3 1995
The Productivity Effects of Employee Stock-Ownership Plans and Bonuses: Evidence from Japanese Panel Data
Abstract
We report the first results for Japanese firms on the effects of employee stock-ownership plans (ESOP's) and bonuses by estimating production functions using new panel data. We find that the introduction of an ESOP will lead to a 4-5-percent increase in productivity; this productivity payoff takes 3-4 years. There is a modest productivity gain from the bonus system. We also find evidence that the productivity effect of bonuses is enhanced by the existence of ESOP's, suggesting that ESOP's may create a climate conducive to profit-sharing by enhancing long-term commitment and peer monitoring.
- Volume
- 85
- Issue
- 3
- Pages
- 391-414
- Sources
- bibtex:phds-export.bib