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In a field experiment analyzing the effects of performance-based monetary incentives, it was shown that productivity improved in line with employees' ability, however, there was an increase in neglect of non-incentivised tasks. [62] Monetary incentives generally have two kinds of effects, known as the standard direct price effect, and the ...
Taxes and subsidies change the price of goods and, as a result, the quantity consumed. There is a difference between an ad valorem tax and a specific tax or subsidy in the way it is applied to the price of the good. In the end levying a tax moves the market to a new equilibrium where the price of a good paid by buyers increases and the ...
The rationale behind them is to obtain economies of scale and pass some (or all) of these savings on to the customer. In some industries, buyer groups and co-operatives have formed to take advantage of these discounts. Iyengar and Jedidi note the popularity of quantity discounts being offered to both business purchasers and consumers. [1]
This is because quantities in the Cournot model are considered as strategic substitutes; that is, the increase in quantity level produced by a firm is accommodated by the rival, producing less. Whereas the prices in the Bertrand model are strategic complements ; a firm aggressively counters an increase in price level by reducing its price below ...
Property P2 is not satisfied. Because the monopolist's profit-maximizing quantity is different from the socially-maximizing quantity, consumers have an incentive to demand more at the equilibrium price. However, at the market price, monopolists maximize their profits so they have no incentive to change their price.
While incentive program participants often state that they prefer cash to non-cash rewards, research has shown that cash is a poor motivator due to its lack of "trophy value." In a recent study conducted by the Center for Concept Development, three of five respondents agree that a cash payment is perceived to be part of an employee's total ...
Valuing all work changes perceptions of what constitutes valuable work. Acknowledging a non-monetary economy may change the ways in which the unemployed, poor, women, and other stigmatized persons’ work is valued. It can allow citizens to see their community as a more cohesive, intertwined system that deserves their time and energy.
Customers tend to notice price increases and react negatively. Rebates offer retailers the benefit of giving customers a temporary discount on an item, to stimulate sales, while allowing it to maintain its current price point. This method avoids the negative backlash that could be perceived with a price being lowered and then raised later. [10]