Employees' Motivation and High Performance Workplace Practices

Employees’ motivation and high performance workplace practices
∗
Annalisa Cristini
University of Bergamo
October 2011
∗
This is a very revised version of a paper I wrote during my sabbatical year at the Department of Economics and
Nuffield College, Oxford. I wish to thank Steve Nickell for extensive discussions and many important insights.
I also thank Duncan Gallie, Ken Mayhew, Ying Zhou, the participants to the Oxford Economics Department
seminar (May 2007) and Jörn-Steffen Pischke for comments on a previous version of the paper. The usual caveats
apply. Research grants from the University of Bergamo are acknowledged. Contact address: Department of
Economics, University of Bergamo, Via dei Caniana 2, 24127 Bergamo, Italy. Email: annalisa.cristini@unibg.it.
Tel.: +39 035 2052 549; Fax: +39 035 2052549.
1
Abstract
Existing evidence shows that employees’ motivation usually improves in presence of in-
novative workplace practices. This paper examines whether this result is ascribable to a
higher intrinsic motivation, which grants a higher effort for a given remuneration and job
quality, or to a higher extrinsic motivation. A simple model of organizational commitment is
suggested to help identify the channels through which innovative practices affect motivation.
The model is estimated on a nationally representative sample of Italian employees. Results
show that practices providing substantial empowerment are powerful intrinsic motivators:
for given pay and working conditions, they strengthen employees’ attachment to the firm
and identification with its values. In contrast, innovative practices bear only marginally on
the extrinsic motivation; moreover, pecuniary rewards are negative reinforcers when contin-
gent on performance; finally, the relative wage can affect employees’ attachment to the firm
but not their sense of belonging.
JEL Classifications: J28 J33 J53 M54
Keywords: High Performance Workplace Practices, Motivation, Commitment, Wages,

Working conditions.
1
1 Introduction
More than forty years ago Leibenstein (1966, p.413) argued that “for a variety of reasons people
and organizations normally work neither as hard nor as effectively as they could” and regarded
motivation to be a major determinant of X-efficiency. Since Leibenstein’s work, the debate
about what motivates real people in real organizations (Simon, 1991) unfolded along the idea
that people’s management should hinge on commitment rather than control (Walton, 1985) and
contributed to the emergence of innovative work systems and management practices1 aimed at
enhancing employees’ commitment through substantial involvement and empowerment (Oster-
man, 1994 and 2000, European Commission, 2002).
This general view attracted a considerable attention and is now supported by a pretty sound
evidence2 ; by contrast, the more specific question of whether the new management practices
bear on employees’ extrinsic or the intrinsic motivation has not been investigated; yet, it is
immediately relevant to the firm costs: The case in which employees involved in the new system
exert a higher effort only to the extent that they share, in the form of higher monetary rewards,
the productivity gains engendered through their involvement3 , is quite different from the case
in which involved employees are more willing to work simply for the work’s sake. In the former
case innovative practices can be regarded as ultimately extrinsic motivators; in the latter one
1
Innovative work systems are usually characterized by so-called High Performance Workplace Practices
(HPWP), which typically include: self managed teams, job rotation, formal arrangements aimed to openly discuss
production problems, suggestions schemes, performance related pay and information sharing; in some cases hiring
procedures and training are also considered. See for example Pfeffer (2007).
2
Freeman and Kleiner (2000) show that employees participating in employee involvement programs (like total
quality management, opinion surveys, information sharing, committee on productivity, worker involvement in
the design of employee involvement programs, worker involvement in work processes, self managed teams) report
higher trust and loyalty to the firm and higher work satisfaction than non-involved employees. Godard (2001),
using a sample of Canadian workers, finds that job satisfaction, commitment and motivation are all positively
related to an indicator of new workplace practices although he also finds that work intensification can in same
cases offsets the benefits. In another Canadian matched employer-employee dataset Mohr and Zoghi (2008)
find that innovative practices (suggestion schemes, task teamworking, job rotation, quality circles, information
sharing, self directed work-group and class training) are all positively related to job satisfaction. For Europe,
Bauer (2003) finds that the degree of job autonomy (regarding tasks order, methods of work, job speed and
quality) and the extent of information sharing (horizontal and vertical communication) drive the positive relation
between HPWP and job satisfaction. However, for Britain, using WERS 2004, Guest and Conway (2007) fail
to find any significant association between employees’ organizational commitment and a bundle of innovative
human resource management practices. Guest (1999) provides a discussion of how employees fare in presence of
innovative practices.
3
The positive role of innovative practices on firm productivity has, on the whole, a sound empirical support;
see for example: Ichniowski, Shaw and Prennushi (1997) and Black and Lynch (2004) for the USA, Wood and De
Menezes (1998), Bryson et al (2005) and Patterson et al. (1997) for the UK, Bauer (2003) and Zwick (2004) for
Germany, Greenan (1996) and Caroli and Van Reenen (2001) for France, Kato and Morishima (2002) for Japan;
Cristini, Gaj and Leoni (2003) for Italy. Less clear-cut results are found on the role of innovative practices on the
wage: these are discussed below in the text.
2
they are genuinely intrinsic motivators (Frey, 1987; Frey and Jegen, 2011; Benabou and Tirole,
2003).
There are at least two further reasons why this distinction is likely to be relevant. The first
one rests on the so called ’hidden costs of rewards’ (Lepper and Greene, 1978; Deci and Ryan,
1985): external interventions, particularly in the form of contingent pecuniary rewards may be
negative reinforcers, thus can partially or totally crowd out one’s intrinsic motivation. This
result, long known in cognitive psychology, has been recently derived by Benabou and Tirole
(2003) within an extended principal agent models where asymmetric information between the
principal and the agent is the conditio sine qua non for this effect to arise.4 . The second reason
is that, even in absence of crowding out effects, extrinsic and intrinsic motivations normally
relate to different work attitudes and behaviors: according to a well known psychological view
initiated by Etzioni (1971) the remunerative power of the organization, not only may undermine
intrinsic motivation, but can also buy only a ’calculative’ type of commitment.
This paper suggests an analytical framework to distinguish between the sources of work mo-
tivation induced by innovative workplace practices and derive the theoretical conditions for the
optimal amount of organizational commitment to rise in presence of such practices. A corre-
sponding empirical model is estimated using a nationally representative sample of 3605 Italian
employees working in the private sector. Results show that the theoretical conditions are easily
satisfied for some but not all innovative practices and that these practices are essentially intrin-
sic motivators. The relative wage is found to have a narrower scope than the best innovative
practices as it helps retaining workers but don’t get to their sense of belonging; furthermore,
the evidence shows that pecuniary rewards, if contingent on performance, can even reduce the
firm attachment by backfiring on employees’ intrinsic motivation. These crowding out effects
are found to be related to the workers’ educational attainments and are interpreted along the
theoretical notion of sorting condition (Benabou and Tirole, 2003).
The rest of the paper is organized as follows: the next section introduces the theoretical set
up; section 3 describes the data, section 4 illustrates the empirical model and the estimation
strategy, section 5 discusses the econometric results and the last section concludes.
4
Various work situations where external interventions are likely to undermine intrinsic motivation are discussed
by Frey (1997) and a survey of the evidence is reviewed in Frey and Jegen (2001); crowding out effects within
labour relationships are supported by laboratory and field experiments (Gneezy and Rustichini, 2000; Fehr and
Schmidt, 2000) and by some econometric evidence based on survey and case studies (Jordan, 1986; Barkema,
1995; Minkler 2004).
3
2 The model
Each employee chooses her amount of commitment Ω∗ in order to maximize the net benefit,
where the benefit and cost functions are respectively concave and convex in commitment: BΩ >
0, BΩΩ < 0 and CΩ > 0, CΩΩ > 0 (Frey, 1997). The marginal benefit is assumed to be positively
related to the employee’s intrinsic motivation (µ) and relative wage5 (w) while the marginal cost
declines with the quality of the working conditions (d). If the benefit and cost functions are
quadratic in Ω and linear in the parameters, the marginal functions can be expressed as follows:
BΩ = [λµ + (1 − λ)w] − c1 Ω (1)
CΩ = −b3 d + c2 Ω (2)
where c1 , c2 , b3 are positive parameters and λ (0 < λ < 1) captures the importance that the
employee attaches to her intrinsic motivation, relative to her wage, in the marginal benefit.
We argue that innovative practices can affect the determinants of the marginal benefit and the
marginal cost. First of all, they are expected to enhance intrinsic motivation to the extent that
they substantially empower employees (Benabou and Tirole (2003), enhance their firm identity
(Akerlof e Kranton (2005))6 , increase workers’ interest in their their tasks, strengthen personal
interactions at work and involve employees in firms’ decisions (Frey (1997)). By contrast, con-
tingent rewards, if part of the innovative system, undermine intrinsic motivation as long as
employees perceive them as a means of control (Etzioni, 1971; Frey, 1997) or as negative signals
of the task attractiveness or of their own ability (Benabau and Tirole, 2003).
Innovative practices might further affect the marginal benefit through the wage. In presence
of wage bargaining, the productivity gains engendered by adopting innovative practices will be
distributed to employees’ salaries in proportion to the unions’ bargaining power; were bargaining
not relevant, the average wage could still rise in presence of productivity gains to the extent that
the employer unilaterally decides to do so on the basis of fairness or other efficiency wage con-
5
The reference wage is thought to be the peer group’s wage; it will be specified in in the empirical section.
6
Benabou and Tirole (2003) use a generalized principal agent model and show that empowerment, if taken
to indicate a positive judgment on the employee’s ability on the part of the principal, can change employees’
attitudes permanently. In a similar vein, Akerlof e Kranton (2005) show that the employee’s work effort rises, for
given monetary incentives, when employees’ identity aligns with the firm’s goals and values.
4
siderations (Akerlof, 1982; Nickell, 1996). Moreover, innovative practices might enhance human
capital (Caroli and Van Reenen, 2001; Bresnahan et al., 2002) bringing about skills upgrading
and consequent wage increases; finally, innovative practices might give rise to amenities or dis-
amenities and the wage could partly or totally compensate for them. Because of these partly
contrasting forces the link between innovative practices and the wage may be weak and indeed
the existing evidence is overall inconclusive.7 .
Turning to the marginal cost of commitment, a strand of the health literature finds that some
innovative practices are associated with a deterioration of working conditions due to increasing
risks of injuries and occupational illnesses8 , to higher rates of anxiety and work intensity and
to a reduced job security.9 . Other scholars have stressed, on the contrary, that job autonomy,
discretion and reduced supervision which ensue from empowerment and involvement, enrich the
job content, are highly appreciated by the workers and highly compensated as amenities (Clark,
2004 Helliwell and Huang, 2005). A priori, the sign of the relation between working conditions
and innovative practices is therefore ambiguous.
7
This is also the conclusion of Handel and Levine (2004)’s survey. Handel and Gittelman (2004), on a sample
of 1062 US establishments from the 1995 Survey of Employer-Provided Training, find no significant impact of
HPWP on either the average establishment wage or the individual wage. Osterman (2000), on a sample of about
300 US establishments in the private sector, finds that core workers employed in firms that introduced HPWP four
years before, enjoy no significant wage gains. Cappelli and Neumark (2001), on the subsample of firms present
since 1977 in the Education Quality of the Workforce National Employer Survey (EQW NES) US panel, find a
positive and significant relationship between practices and labour cost. Black, Lynch and Krivelyova (2004), on
the subsample of all manufacturing firms in the EQW NES also find a positive association between wages and the
practices of meetings and profit sharing, but only when practices are interacted with the union dummy. Osterman
(2006) finds a positive impact of a principal component indicator of HPWP on the level of the median wage of
core non-manager employees. Godard (2007), using Canadian and English data, finds that the combination of
union representation and best practices yields relatively higher wages although high performance practices are
strongly associated with non-union workers’ wages.
8
Askenazy (2001) uses a panel of 26 US sectors over four quinquennia from 1979 to 1991 and finds that total
quality management, job rotation and autonomous work teams are related to greater occupational injuries and
illnesses. Farris and Brenner (2001) and Brenner et al. (2004) combine the 1993 US Survey of Employer Provided
Training with the 1993 Survey on Occupational Injuries and Illnesses and find that total quality management and
the interaction of total quality management and teamwork raises cumulative trauma disorders; the ”suspicion
that total quality management represents a new form of taylorism” is also raised by Adler et al., (1997). More
recently, Askenazi and Caroli (2006) using a representative sample of French workers find quality norms and job
rotation to be associated with higher number of injuries and mental strain. Mohr and Zoghi (2008) use Canadian
data and find that quality circles rise the desire to work less hours due to stress but do not find a direct relation
between days of work lost and HPWP.
9
According to Gallie and Green (2002) UK skilled workers and workers upskilling are characterized by mounting
anxiety, and Green (2004) associates work intensification to the new workplace. Osterman (2000) finds that as
new work systems may lead to thorough reorganizations and layoffs, job security is also jeopardized. According
to Black et al. (2004, Table 7) the probability of experiencing a 20% or more employment reduction is positively
associated with an intensive use of self managed teams and job rotation by non managerial workers although the
results are attenuated in unionized establishments.
5
Taking stock of the above discussion, we model the following system of linear equations:
d = f (π|z) (3)
w = g(π, d|z) (4)
Ω∗ = c−1 [λµ(π) + (1 − λ)w + b3 d] (5)
where z is a vector of exogenous variables (typically, the employee’s personal characteristics),

f (·) and g(·) are monotonic functions, equation (5) is derived from equating the marginal cost
and the marginal benefit of commitment, c = c1 + c2 > 0 captures the curvatures of the benefit
and cost functions and summarizes preferences.
Optimal commitment rises with involvement if the following holds:
∂µ dw ∂d
λ + (1 − λ) + b3 >0 (6)
∂π dπ ∂π
where dw/dπ = ∂w/∂π + ∂w/∂d · ∂d/∂π.

The condition is determined by three components: the effect of innovative practices on the
intrinsic motivation (λ · ∂µ/∂π), on the relative wage ((1 − λ) · dw/dπ) and on the working
conditions (b3 · ∂d/∂π). The empirical values of these three components are estimated in section
4 and innovative practices will be classified accordingly. The above inequality is always satisfied
if dw/dπ ≥ 0, ∂µ/∂π > 0 and ∂d/∂π > 0 and never satisfied if dw/dπ ≤ 0, ∂µ/∂π < 0 and
∂d/∂π < 0. The relative weight of the intrinsic motivation matters, however, when the three
components have opposite signs. Table 11 in the appendix derives the values of λ for which the
condition holds: as the effects of the practices on the wage and on working conditions decline
and become negative, λ must rise if ∂µ/∂π > 0 and decline if ∂µ/∂π < 0.
3 The data
The data used to estimate the model are taken from the survey OAC (”Organizzazione, Ap-
prendimento e Competenze” which translates as ”Organization, Learning and Competencies”)
designed by ISFOL (Institute for the Development of Workers’ Training, a public think tank
based in Rome) on the basis of Skills in Britain (Felstead et al., 2002) and addressed in 2004
6
to a nationally representative sample of 4000 Italian employees working in the private sector
(ISFOL, 2007; Tomassini, 2006).10 . The survey was carried out in collaboration with the Italian
Statistical Institute and its statistical structure was based on the Italian Labour Force Survey.
Employees were first contacted and then interviewed at home using CAPI; net of errors and in-
valid strings, 3605 observations were finally made available11 . The detailed information that the
survey provides on employees’ involvement in innovative practices, on the content of their jobs,
on working conditions, on the presence of contingent premia, on the average wage, together with
numerous individual and firm characteristics, makes it a very useful dataset for this empirical
analysis.
Organizational commitment is measured on the basis of a standard set of statements on which
the employee is asked to agree or disagree using a Likert scale12 : (i) This organization really
inspires the very best in me in the way of job performance; (ii) I am proud to be working for
this organization; (iii) I find that my values and the organization’s values are very similar; (iv)
I feel very little loyalty to this organization; (v) I am willing to work harder than I have to in
order to help this organization succeed; (vi) I would take almost any job to keep working for
this organization; (vii) I would turn down another job with more pay in order to stay with this
organization. In order to test for potential different effect of extrinsic and intrinsic motivation,
I distinguish between two types or dimensions of commitment: a dimension reflecting sharing
of values and firm identification, captured by items (i)-(v), and a dimension of firm attachment,
captured by items (vi)-(vii), characterized by a relatively stronger sense of commitment revealed
by the fact that the employee is ready to bear a ’cost’ to stay with the organization, implicit
either in the acceptance of ’any job’ or in the refusal of a better outside job offer. For conve-
nience I call the two components value and strong commitment and will be used as alternative
measures of Ω.13 .
10
http://www.isfol.it/Banche Dati/Organizzazione apprendimento e competenze (Oac)/index.scm
11
Because of problems related to eligibility details and low response rates required the conduct of some extra
interviews; the validation procedure discarded any bias between the two parts of the survey (ISFOL (2007),
chapter 1).
12
The statements are a subset of the most frequently used Mowday’s Organizational Commitment Questionnaire
(Mowday et al. 1979) and are the same used in by Gallie et al. (1998) for Britain. The Likert scale is: Totally
disagree (1), Strongly disagree (2), Disagree (3),Indifferent (4), Fairly agree (5), Strongly agree (6), Totally agree
(7).
13
Gallie et al. (1998, p.238) comment that items (vi) and (vii) ”express a willingness to be flexible to the point
of some personal sacrifice, and can be regarded as particularly strong expressions of commitment (while) the
remaining (items) are rather weaker expressions of identification with the organization and its values.” See also
Godard (2001) for an equivalent distinction. Both measures are computed by summing the relevant items, after
reversing the scales of statement (iv), and then rescaling the indicators into 7 categories. The different skewness of
7
Employees’ involvement in innovative practices is measured by a vector of dummy variables on
the basis of employees’ answers to the following specific questions: ”Do you take part in qual-
ity circles?” (qc); ”Do you participate in periodic employer-employee meetings?” (meet); ”In
the last 12 months have you made any suggestions to colleagues or heads aimed at improving
efficiency in your work?” (suggest); ”Has your company received any quality certification?”
(quality); ”Do you work in team?” (team); ”Is your team autonomous in task-related issues?”
(task)14 ; ”Is your team responsible for the output or service produced?” (resp); ”Is your team
autonomous in matters regarding the team members?” (group)15 . On the basis of these infor-
mation, lean teams (team is true but none of task, resp and group is true) is distinguished
from various types of sociotechnological teams characterized according to the extent and types
of autonomy.16 . In particular, when team, task, resp and group are all true, the team is
fully autonomous and the definition is very close to the one used by Cullie et al. (1999) and
Harley (2001); however, the approach used in this paper also allows one to detect intermediate
cases where only some of the autonomy dimensions may be present. With regard to contin-
gent rewards, we know whether the employee has received monetary premia on the basis of her
performance. Specifically, two are the relevant questions: ”Have you been formally appraised
at work in the last twelve months and do these appraisals affect your earnings in any way?”
the two densities (not shown) confirm that it is relatively easier to be value-committed than strongly-committed.
Results are qualitative similar but not as clear cut, if item (v) is included in the strong commitment definition
rather in the value commitment one. Alternative composite indicators based on the number of statements the
respondent agrees with, show distributions far away from the normal and were not used.
14
Either one of these two item must be true: a) The team members together decide how to do the work; b)
The team members together decide which other tasks to do.
15
Either one of these three items must be true: a) The team members together propose the team leader to
the management; b) The team members together decide the team leader; c) The team members together decide
about matters regarding new team members.
16
Autonomous or self managed teamworking origins in the Swedish-inspired sociotechnical team which, in
contrast to the Japanese-inspired lean team, enjoys a significant degree of autonomy; although regarded as a
crucial practice in the new work systems (Benders and Van Hootegem, 1999) the minimum discretion that a team
must enjoy in order to be classified as ’autonomous’ varies in the literature; for example, Cullie et al. (1999)
and Harley (2001), both using UK WERS, define autonomous teams as those in which ”members work with one
another and have responsibility for specific product or service and jointly decide how work is to be done” or
as those in which ”members work with one another and have responsibility for specific product or service and
jointly decide how work is to be done and appoint their own team leaders”. Scholars using EPOC (Benders et al.,
2001) or similar surveys (Steijn, 2001) define a team to be autonomous if it has decision rights on at least 4 or
5 out of 8 activities; these are: allocation of work, scheduling of work, quality of work, time keeping, attendance
and absence control, job rotation, coordination of work with other internal groups, improving work processes.
Batt (2004) studies a case where self managed teams are those that assume supervisory tasks including: setting
daily assignments, writing up reports, covering breaks and schedules, handling non-routine problems, and calling
directly on subject matter experts as needed. As it is clear from the longstanding sociological debate on self
managed teamworking, the difficulty of an exact definition reflects the eclectic implementation of this concept in
the real workplace (Steijn, 2001); then, in designing an empirically viable definition, it is important to retain a
sufficient flexibility.
8
(earn); ”As a team member, do you receive monetary rewards based on the team performance?”
(teampay). A further question regards contingent training: ”Have you been formally appraised
at work in the last twelve months and do these appraisals affect the amount of training you
receive?” (train), which could also be regarded as a performance-related external intervention.
On the whole, π is composed of eleven dummy variables.
Finally, the overall quality of working conditions as perceived by the employees is measured
by a set of categorical variables; three of them regard physical working conditions: i. Fre-
quency of exposure to serious accidents (accidents); ii. Frequency of exhaustion from work
(exhaustion); iii. Effort intensity (effort intensity). Four variables concern the job content:
iv. Strictness of supervisor’s control (supervision); v. Job repetitiveness (repetitiveness);
vi. Job discretion (discretion); vii. Job autonomy on timing and effort (autonomy)17 and a
final variable regards job security: viii. Probability of unemployment over the next 12 months
(unemployment). The vector d is therefore composed of these eight variables which vary on
a 1-7 Likert scale, from low to high.
3.1 Innovative practices and employees’ commitment: descriptive evidence
Column 1 in Table 1 ranks workplace practices in descending order of frequency. Over 70%
of employees have given some suggestions in the last 12 months, and almost 60% take part in
joint meetings; nearly half of the employees work in teams but only 38% are members of teams
with autonomy on tasks and procedures18 ; a third of employees work in teams that are held
responsible for the output produced and a somewhat lower percentage of workers have some au-
tonomy in matters regarding the team leader and new members. Contingent monetary rewards
are not very common: earnings linked to individual performance assessments involve 13% of
employees while team performance related pay involves 8% of employees; training contingent on
individual assessments involves 10% of employees. Columns 2-5 of Table 1 report the ranking
of the practices by employees’ levels of education. With the exception of lean teams, the data
confirm that the frequency of involvement rises with employees’ educational attainment. This
point will be further discussed in section 5.2.
17
The latter is obtained by summing the scores of three types of job autonomy: job autonomy on timing and
effort, job autonomy on tasks and their sequence and job autonomy on how to do the task. The total score is
then re-scaled to 1-7.
18
As shown in Table 7 in the Appendix, 22% of all employees work in teams; of these, 48% are members of
fully autonomous teams, 14% work in task-autonomous teams, 12% work in task-autonomous-output-responsible
teams and 11% work in lean teams.
9
Descriptive evidence supports the view that employees involved in new workplace practices are
relatively more committed to their organization than employees not involved (Table 2); the
former report significantly higher scores in loyalty, pride of belonging to the company, share of
values and readiness to work harder for the organization’s success. Employees using suggestion
schemes and taking part in joint meetings and QC are also more likely to forgo a better paid
job to stay with the organization but no innovative practice significantly increases employees’
willingness to take up any job to stay with the firm. As already found by Freeman and Kleiner
(2000) on US data, employees working in teams report higher scores in loyalty and willingness
to work harder; however, employees working in lean teams are significantly less inspired by the
organization and less in line with its values with respect to the other employees while those
working in task autonomous teams are relatively prouder of being part of their organization.
Contingent rewards are positively associated with employees’ pride, loyalty and effort but only
employees individually appraised declare to be relatively more inspired by the organization and
share its values. On the whole, being involved in the new practices appears to make a difference
more for value than for strong commitment: significantly higher scores in the latter are asso-
ciated only with joint meetings while relatively higher scores in the former are also associated
with suggestion schemes, task autonomous teamworking, contingent training and contingent
monetary rewards.
The relationships just described, being unconditional, could merely capture spurious correla-
tions; for example, if larger firms are relatively more likely to adopt innovative practice and can
also pay relatively higher wages that motivate their workforce, the relation between employ-
ees’ commitment and workplace practices would simply capture the role of firm size. The next
section then turns to the multivariate analysis.
4 Empirical model
By drawing from the theoretical analysis, the empirical model is specified as a linear system of
equations:
d = A1 π + Φz + u1 (7)
w = α2 π + β2 d + ϕ 2 z + u 2 (8)
Ω = α3 π + β3 d + γ3 w + ϕ3 z + u3 (9)
10
where d is the vector of categorical variables capturing the quality of the employee’s working
conditions, w is the log of the monthly take home relative wage, Ω is either one of the two mea-
sures of organizational commitment defined in the previous section, π is the vector of dummies
capturing employee’s involvement in innovative practices, z is the vector of controls.19 . Both z
and π 20 are assumed uncorrelated with the error terms u1 , u2 , u3 . A1 and Φ1 are matrices of
coefficients and the remaining symbols are row vectors of coefficients.
Notice that by confronting equation (9) to the corresponding theoretical equation (5), γ3 =
(1 − λ)c−1 . Hence, as long a c−1 is constant across the two different measures of commitment,
which is the case if the employee’s preferences underlying her benefit and the cost functions
of commitment are constant, the empirical γ3 estimated for strong and value commitment are
informative on the magnitude of λ across the two types commitment. Again, by confronting the
empirical and the theoretical model, for each practice α3 = λµ(π)c−1 which, given the above ar-
gument can be informative on the role of innovative practices on employee’s intrinsic motivation,
in the two types of commitment.
4.1 Identification and estimation strategy
The system (7)-(9) is recursive; a useful approach for its identification would be to make it fully
recursive using covariance restrictions, thus avoiding the more common alternative of exclusion
restrictions: under full recursiveness the error covariance matrix is diagonal, all equations are
identified and OLS estimates are unbiased (Wooldridge, 2001). However, in this specific case,
the covariance matrix is unlikely to be diagonal because of common components in the error
terms. In particular, one should consider the possibility that the sorting of employees into new
work systems may not be random but related, for example, to some unobservable psychological
traits or family characteristics, or to the employee’s unobservable ability. The latter possibility
is of particular interest as existing results (Caroli and Van Reneen, 2001 and Bresnahan et al.,
2002) show that new workplace practices complement with high skill workers. In this case, if
controls in the regression only partially capture workers’ heterogeneity in cognitive and non
cognitive ability (Heckman et al., 2006), a self selection problem may arise. Specifically, if more
19
Individual controls used in the empirical model include: ID, familiar status, children, education, skill level,
experience, tenure, occupation, region of residence and others. Firm controls include: size, sector, region, union
presence. See Table13 for the complete list of controls.
20
In a more general framework workplace practices could be regarded as a choice variable on the part of the
employer. Empirical evidence on the determinants of the adoption of innovative practices by the firm see Lynch
(2007), Osterman (1994), Wei, Freeman and Keliner (2011).
11
able workers were more likely to be involved in innovative practices and wages and ability were
also positively correlated, the coefficients of workplace practices in the wage equation would be
upward biased21 ; likewise, if ability and commitment were related, for instance because more
able workers were ceteris paribus less strongly committed to the firm because they can count on
broader outside opportunities, then the coefficients of both workplace practices and the wage in
the commitment regression would be downward biased.
Therefore, let each error term be the sum of two components: ηi and χis where χis is a pure
error unrelated across equations and ηi is a component common to all equations capturing un-
observable individual characteristics; full recursiveness is then satisfied only if ηi is adequately
instrumented. In order to do this, I follow van Praag et al. (2003) and use the first principal
component of the estimated residuals from the subsystem of equations (7) to instrument the
common component in equations (8) and (9).
Since d is a vector of qualitative categorical variables, in order to allow for correlation across
errors of subsystem (7), I first transform the ordinal dependent variables into discrete variables
ranging on the real axis as suggested by Terza (1987)22 and then apply Zellner’s seemingly
unrelated estimator. Finally, using factor analysis, I compute the first principal component of
the SUR error covariance matrix and use it as an additional regressor in equations (8) and
(9); the wage and commitment equations can then be estimated separately by OLS and or-
dered probit, respectively. This procedure takes care of the endogeneity bias in the wage and
commitment equations. Notice that in the wage and commitment regressions, the use of the
Terza-transformed job attributes in place of the original ordinal variables avoids including, for
each job attribute, a number of dummies equals to the number of categories minus 1, thus also
helping the interpretation of the results.
21
In the wage equation unobserved ability is also expected to bias the coefficients of job attributes: if more
able workers use their endowment to obtain both a better quality job and a higher wage, then the ’price’ of job
amenities will be downward biased (Hwang, Reed and Hubbard, 1992; Helliwell and Huang, 2005).
22
Terza (1987)’s suggested transformation replaces each category j of an ordinal variable by Φj where Φj =
E(ϕj |θj−1 < ϕj ≤ θj ) and θj are the (maximum likelihood) normal quintile values of the percentages of the
sample observed in category j. See also van Praag et al., 2003 for similar considerations.
12
5 Results
Tables 3 and 4 present the estimated model. The SUR estimates23 of the sub-system (7) are
reported in Table 3; they show the extent to which innovative practices are related to the quality
of the employee’s working conditions. It turns out that innovative practices differ substantially
in this respect. Being involved in joint meetings and using suggestions is positively related to job
autonomy and discretion and negatively to job repetitiveness; joint meetings are also negatively
associated with the strictness of supervision, with effort intensity and exhaustion, thus resulting
as the practice that most of all is associated with good job quality. The teams’ latitudes in
deciding tasks and managing the group also imply greater empowerment although the extent of
job autonomy declines when teams are responsible for the output produced; likewise, strictness
of supervision, effort intensity and exhaustion all increase when teams self direct the group, hint-
ing to the presence of adverse peers’ pressure effects (Barker, 1993; Adler et al., 1997; Harley
2001) and casting some doubts on the overall job enrichment of fully autonomous teams.24 . The
existing evidence according to which risks of injuries and occupational illnesses increase with
some innovative practices is confirmed only for contingent monetary rewards (earn) which are
positively related to both effort intensity and the perceived frequency of accidents. Lean teams
(team) are also associated with poor intrinsic job content and with exhaustion and, similarly,
QC are positively related to exhaustion, intensity of effort, repetitiveness and reduced autonomy;
neither practice, however, is significantly associated with the perceived risk of injuries. Finally,
supervision, effort intensity and exhaustion are lower when firms comply with quality norms but
the employee’s job autonomy is only marginally higher in this case.
Table 4 reports the estimated wage and commitment equations. All regressions control for the
common error component, suitably instrumented as previously discussed. The relative wage25 ,
in column (1), is unrelated to most empowerment practices, the exceptions are task autonomous
23
All estimations are weighted using the population weight provided in the dataset, ISFOL(2007).
24
On the whole, being member of a fully self managed team does not mean greater job autonomy: the sum of
the coefficients of team, task, group, resp and teampay is not statistically different from zero; the validity of
the implicit assumption of negligible interaction effects is confirmed by including a dummy for fully autonomous
teams in the regressions.
25
Following Clark and Oswald (1996), the log of the relative wage is defined as the difference between the
individual log wage and a reference log wage defined as the fitted values of the log wage on the following variables
and controls: monthly hours of work, age, age squared, years of experience, years of tenure, education dummies,
fulltime job dummy, permanent job dummy, skill level dummies, gender dummy, dummy for workplace located in
the south, pension fund dummy, firm size dummies, region dummies, sector dummies, organizational are dummies,
occupational dummies; see appendix for more details on the controls. On the concept of relative wage, its relevance
and its measurement see for example Clark and Oswald (1996).
13
teamworking which rises the relative wage by 6% and output responsible teamworking which
lowers it by 4.5%; fully self directed teams are eventually unrelated to the relative wage26 .
Contingent rewards significantly add to the wage only if monetized on the basis of individual
appraisals (earn): in this case the relative wage rises by 9%; on the contrary, the relative wage
declines by more than 3% when monetary rewards are based on the team performance or when
individual appraisals are used for training purposes (train).
Columns (2)-(5) show the commitment ordered probit estimates and the marginal effects of the
practices computed for the second largest category (category 6). Since the relative wage and
working conditions are controlled for, the estimated coefficient of each innovative practice is
indicative of the relevance of the latter on employees’ intrinsic motivation. Task autonomous
teamworking, joint meetings and QC enhance the intrinsic motivation of both value and strong
commitment; suggestions schemes have some positive relevance only for value commitment. On
the contrary, lean teams, output responsible teams and quality norms depress employees’ intrin-
sic motivation. The estimated coefficient for the relative wage, which is positive and statistically
significant only for strong commitment, suggests that λ, relative weight of intrinsic motivation
in the employee’s marginal benefit, is low when at stake is the decision of staying with the
organization and high when matters concern alignment with the firm’s values. Also contingent
pecuniary rewards bear only on strong commitment but they significantly crowd out intrinsic
motivation: the probability of a high strong commitment (category 6) declines by 1.3% if em-
ployees are individually appraised and by 2.1% if they receive a team performance-related pay.
These findings nicely accord with the psychological view according to which the remunerative
power of the organization can buy only a ’calculative’ type of commitment and may have poten-
tially negative effects on the intrinsic motivation (Etzioni, 1971). In order to obtain the overall
impact of each innovative practice on commitment and determine dΩ∗ /dπ, the indirect effects
of the practices channeled to commitment via the wage and the working conditions, need also
be considered. This is done in the next section.
26
The linear restriction (TEAM+TASK+GROUP+RESP=0) is not rejected by the data: F (1, 2889) = 0.16,
P rob F = 0.69.
14
5.1 Disentangling the motivational channels
In order to quantify the indirect effects of the practices, I estimate the reduced forms obtained
from equation (9) after substituting for working conditions, for the relative wage and for both.
Ωi = (α3 + β3 A1 )πi + γ3 wi + (ϕ3 + β3 Φ1 )zi + u3i + β3 u1i (10)
Ωi = (α3 + γ3 α2 )πi + (β3 + γ3 β2 )di + (ϕ3 + γ3 ϕ2 )zi + u3i + γ3 u2i (11)
Ωi = (α3 + γ3 α2 + γ3 β2 A1 + β3 A1 )πi + (ϕ3 + γ3 ϕ2 + β3 Φ1 + γ3 β2 Φ1 )zi + u (12)
where u = u3i + γ3 u2i + β3 u1i + γ3 β2 u1i

The marginal effects of π computed from these reduced forms, compared with the marginal
effect obtained from equation (9), allow to distinguish the overall effect of each practice on
commitment into its three components: the intrinsic motivation effect α3 , the total wage effect
γ3 α2 + γ3 β2 A1 and the working conditions effect β3 A1 .
The three components and the total effects are shown in Table 5. Notice that the marginal
effects, again computed for category 6, are normalized to the frequency of the category in order
to be able to compare the role of each practice on the two types of commitment which have
different frequencies in the category of interest (29.6% for value commitment and 7.2% for strong
commitment). The ordered probit estimates and the marginal effects are reported in Tables (8)
and (9) in the Appendix. In Table 5 practices are ranked in descending order with respect to
their overall normalized marginal effects, and for ease of interpretation results for teamworking
are presented by type of teams.
dΩ∗ /dπ is positive for all empowerment practices except for the two extreme types of teamwork-
ing: lean teams and fully self-managed teams and, limited to value commitment, for quality
norms. Receiving any type of contingent reward reduces strong commitment while only contin-
gent team premia reduce value commitment. With a few exceptions, the effect of the practices
on the intrinsic motivation drives the overall effect thus confirming that this is the main channel
activated by the innovative practices. The largest effects on the intrinsic motivation are found
on strong commitment and are conveyed by task autonomous teamworking, joint meeting and
QC which rise the probability of a high score by almost 50%. The same practices are also the
most effective ones on the intrinsic motivation of value commitment but their strength is com-
paratively lower in this case, rising the probability of a high score by 20% at most. If, as argued
15
before, λ is smaller in strong commitment than in value commitment, these results suggest that
∂µ/∂π is relatively higher in strong commitment.
The indirect effects, either through the wage or the working conditions, are generally much
smaller in size. In particular, the indirect effects working through the job quality are mostly
negative on value commitment, a result driven in large part by the negative association between
team and working conditions and play only a marginal role on strong commitment. The indi-
rect effects conveyed by the wage partly counterbalance the intrinsic motivation effects on strong
commitment, and are again mostly negative while on value commitment they tend to reinforce
intrinsic motivation; in both cases they are relatively small.
Team performance related rewards reduce the probability of a high score in strong commitment
by 40%, thus ranking as the worst practice; a less disruptive role of contingent rewards is evi-
dent only when they are based on individual appraisals. This result, consistent with the idea
that employees’ morale might be particularly penalized when the individual effort cannot be
explicitly acknowledged, is further explored in the next section.
Table 12 in the appendix summarizes the results in a schematic way by classifying the practices
according to the signs of the three components determining the inequality (6) derived in section 2.
5.2 A further look at crowding out effects: commitment by education
In Benabou and Tirole (2003) crowding out effects are rationalized by the presence of asymmetric
information and the corresponding signal perceived by the less informed employee; specifically,
crowding out effects emerge when the principal has some information about the task or about
the worker himself that the worker does not have, and the principal’s gain from such a superior
information (the so-called sorting condition) is a bad news for the employee. When the signal
is, instead, favorable to the employee, the sorting condition works in the opposite direction and
the final outcome is one of crowding in. Similarly, Frey (1997) and Frey and Jegen (2001) ar-
gue that crowding out effects depend on the worker’s perception about the employer’s external
intervention; when it is regarded as controlling, crowding out effects are likely to arise; on the
contrary, when it is perceived as informative, crowding out effects do not arise or crowding in
may take place. The employee’s perception about the intervention is therefore a key element in
Frey (1997) as in Benabou and Tirole (2005).
16
The commitment regressions presented in section 5 give credit to the idea that the contingency
of a reward and its monetization are relevant for crowding out to emerge and that the degree
of crowding out rises when rewards disregard individual efforts. In what follows the role of the
employee’s perception about the reward is further investigated.
The basic assumption is that simple and standard tasks should in principal be paid standard
rewards; a contingent pay in this case would then be regarded as a signal of some bad attributes
of the task, of which workers are not informed, or as a controlling device. On the contrary,
for more complex and distinctive tasks a performance related pay should be perceived as being
informative of the employees’ effort more than controlling. Thus, ceteris paribus, crowding out
effects should be more likely when contingent rewards are used to remunerate standard tasks and
less likely when associated with non standard jobs. In order to test this suggestion, the degree
of standardization of a task is supposed to be inversely related to the employee’s educational
attainment: the more standard tasks are expected to be performed by the less educated work-
ers, and the less standard tasks are expected to be performed by the more educated workers.
Specifically, I consider four levels of schooling: compulsory, vocational secondary (i.e. from 1 to
3 years of post-compulsory school), technical secondary (i.e. 5 years of post compulsory school)
and tertiary (i.e. undergraduate and graduate degrees) and I estimate the basic commitment
regressions for each of them.27 .
Results are reported in Table 6. Crowding out effects are observed for workers with compul-
sory schooling; since tasks, in this case, are expected to be relatively standard, results support
the view that contingent rewards are perceived as a means of external control. However, since
crowding out effects are strongly associated with team-performance related rewards (teampay),
one could also argue that the type of reward per se is a negative reinforcer because of its mon-
itoring role and its likely uniformity across team members. Crowding out effects, however, do
not apply when the same reward is used for higher educated workers, thus indicating that they
cannot be related to the type of reward per se. Likewise, crowding in effects emerge when con-
tingent rewards based on individual appraisals are used for tertiary educated employees but the
same type of reward produces crowding out effects when used for less educated employees, again
suggesting that the sorting condition is favorable to highly educated workers. Non pecuniary
contingent rewards (train) also crowd out motivation when applied to low educated workers,
27
Regressions by type of schooling are equivalent to saturating the previous model by allowing each regressor
to have a different coefficient depending on the education attainment of the employee.
17
presumably signalling bad task attributes. All these results accord with a use of contingent
rewards that rises with employees’ years of schooling, as observed in the descriptive statistics
(Table 1).
These regressions further confirm that the relative wage is a powerful motivator for compulsory
and vocational skill groups to remain attached to the firm but it is ineffective on the value
commitment across all educational groups; again, for given preferences, this implies that λ rises
with education, a result that accords with other findings for manual workers (see Lane, 1991
chapter 19, cited in Frey, 1997).
6 Conclusions
Innovative workplace practices are usually associated with high employees’ morale. This paper
has examined whether the higher organizational commitment associated with innovative work-
place practices is ascribable to a higher intrinsic motivation, which grants a higher effort for a
given remuneration and job quality, or to a higher extrinsic motivation, basically driven by a
higher pay.
The question has been tackled using a simple model according to which employees choose
organizational commitment in an optimal way by equating the marginal benefit and the marginal
cost of effort where the marginal benefit from commitment is a weighted average of intrinsic
motivation and the relative wage, and the marginal cost depends on the working conditions.
Innovative practices may change the marginal benefit by affecting employees’ intrinsic motivation
and/or by allowing higher pecuniary rewards, and may change the marginal cost of effort by
affecting the job quality.
Results show that empowerment practices that allow a substantial empowerment in terms
of greater job autonomy, greater discretion, reduced supervision and reduced repetitiveness, can
enhance both the sense of belonging and the attachment to the organization. Such practices,
like joint meetings and teamworking with latitude on tasks and procedures, affect commitment
mostly directly, that is by reinforcing employees’ intrinsic motivation, whereas their indirect
effects, which influence commitment through the wage and the job quality, are comparatively
smaller.
Results also show that employees tend to attach a relative low weight to intrinsic motivation
18
in their marginal benefit functions, when they are concerned with decisions regarding their
attachment to the organization and a relatively high weight when considering their identification
with the firm’s values. Findings also indicate that the weight attached to intrinsic motivation
rises with employees’ educational attainment.
Contrary to the best empowerment practices, the relative wage helps retaining employees
but cannot affect their value commitment; moreover, pecuniary rewards if contingent on per-
formance, significantly crowd out intrinsic motivation, in accordance with existing experimental
results. These effects are particularly harmful on employees’ attachment to the firm and are only
partly compensated by the wage when rewards are contingent on the individual performance.
A deeper investigation into the crowding out effects supports the view that whether a contin-
gent reward determines crowding out or crowding in essentially depends on how it is perceived
by the employee. In particular, the findings indicate that the use of contingent rewards for
standard tasks is likely seen as a means of control or as a signal of bad task attributes, hence
crowds out intrinsic motivation. For more complex tasks, contingent rewards are not found to be
negative reinforcers and, if based on individual appraisals, raise employees’ intrinsic motivation
consistently with the idea that they are perceived as genuine signals of trust on the part of the
employer.
On the whole, this paper suggests that firms should invest in empowerment practices both be-
cause they are the sole instrument to increase their employees’ sense of identity, loyalty and share
of values and because they outperform the wage in retaining employees; contingent pecuniary
rewards, specially if based on the team performance, are, instead, unwise as they significantly
reduce employees’ attachment to the organization while leaving employees’ value commitment
unaffected. Self managed teams show mixed results on commitment, largely depending on the
extent of autonomy they are granted, but are always a mediocre practice when fully autonomous.
Finally, the empirical relevance of innovative practices differs greatly across educational
groups, suggesting that specific practices may complement specific skills, a result which deserves
further investigation.
19
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Table 1: Share of employees by workplace practices and educational attainments
All employees Compulsory Vocational Technical Tertiary

empowerment practices
SUGGEST 0.71 0.58 0.65 0.75 0.86

MEET 0.56 0.38 0.45 0.62 0.78
TEAM 0.47 0.49 0.43 0.46 0.49
QUALITY 0.43 0.34 0.37 0.46 0.52
TASK 0.38 0.36 0.36 0.38 0.45
RESP 0.33 0.33 0.33 0.32 0.38
GROUP 0.26 0.24 0.29 0.25 0.33
QC 0.09 0.07 0.09 0.09 0.12
contingent rewards
EARN 0.13 0.06 0.06 0.15 0.29

TEAMPAY 0.08 0.05 0.07 0.09 0.14
TRAIN 0.10 0.08 0.08 0.10 0.19
nr. observations 3605 878 538 1709 480
Notes: Compulsory: 10 years of schooling; vocational secondary: 1 to 3 years of post-

compulsory school; technical secondary: 5 years of post compulsory school; tertiary: under-
graduate and graduate degrees.
Table 2: Differences in organizational commitment between employees involved and employees not
involved.
By workplace practices
(1) (2) (3) (4) (5) (6) (7) (8) (9)

value comm strong comm inspires proud share values loyal work harder any job no quit
SUGGEST 0.46** 0.06 0.30** 0.42** 0.35** 0.64** 0.50** -0.12** 0.22**
MEET 0.35** 0.10** 0.27** 0.38** 0.24** 0.46** 0.41** -0.07 0.26**
QC 0.30** 0.13 0.19** 0.33** 0.21** 0.36** 0.40** -0.03 0.23**
QUALITY 0.05 -0.01 0.01 0.10** -0.03 0.07 0.12** -0.11** 0.05
TEAM 0.00 0.02 -0.09* 0.04 -0.08* 0.13** 0.10** 0.04 -0.02
TASK 0.10** 0.01 0.02 0.12** 0.03 0.19** 0.20** 0.00 0.01
GROUP 0.04 -0.05 0.02 0.01 0.02 0.07 0.13** -0.07 -0.06
RESP 0.04 -0.06 -0.04 0.02 -0.01 0.13** 0.16** -0.05 -0.08
contingent rewards
TEAMPAY 0.12* -0.02 -0.02 0.20** 0.03 0.23** 0.16* -0.15 0.07
EARN 0.20** 0.03 0.18** 0.32** 0.16** 0.23** 0.24** -0.08 0.12
TRAIN 0.20** 0.03 0.20** 0.26** 0.15** 0.28** 0.23** -0.05 0.10
Notes: Number of observations: 3605. **Significant at the 5% level or less *Significant at

the 10 % level
Table 3: Overall working conditions
Physical working conditions Job security Job content

accidents exhaustion effort prob. repetitiveness supervision discretion autonomy
intensity unemployment
(1) (2) (3) (4) (5) (6) (7) (8)
SUGGEST 0.130 0.151 0.083 –0.168*** –0.375*** –0.089 0.401*** 0.418***

(0.13) (0.10) (0.05) (0.05) (0.11) (0.06) (0.05) (0.07)
MEET 0.089 –0.409*** –0.191*** –0.006 –0.429*** –0.152** 0.150*** 0.279***
(0.13) (0.10) (0.05) (0.05) (0.11) (0.06) (0.05) (0.07)
QC 0.014 0.393** 0.074 0.162* 0.361** –0.057 0.038 –0.364***
(0.20) (0.15) (0.09) (0.08) (0.18) (0.10) (0.09) (0.11)
QUALITY –0.176 –0.313*** –0.184*** –0.089* 0.123 –0.188*** 0.051 0.121*
(0.12) (0.09) (0.05) (0.05) (0.11) (0.06) (0.05) (0.06)
TEAM 0.173 0.423** 0.077 –0.098 0.548*** –0.025 –0.313*** –0.537***
(0.21) (0.16) (0.09) (0.09) (0.19) (0.10) (0.09) (0.11)
TASK 0.268 –0.513*** –0.206** 0.222** –0.381* –0.097 0.241** 0.331***
(0.24) (0.19) (0.10) (0.10) (0.21) (0.11) (0.10) (0.13)
GROUP –0.230 0.429** 0.269*** 0.082 –0.181 0.308*** 0.180* 0.573***
(0.22) (0.17) (0.09) (0.09) (0.19) (0.11) (0.10) (0.12)
RESP 0.313 0.042 0.108 –0.010 0.072 –0.134 0.010 –0.296***
(0.22) (0.17) (0.09) (0.09) (0.19) (0.10) (0.09) (0.11)
contingent rewards
TEAMPAY –0.120 –0.643*** –0.100 –0.346*** –0.012 0.198* –0.069 –0.126

(0.23) (0.18) (0.10) (0.10) (0.20) (0.11) (0.10) (0.12)
EARN 0.718*** –0.075 0.244*** –0.112 –0.765*** 0.013 –0.002 –0.105
(0.22) (0.17) (0.09) (0.09) (0.19) (0.10) (0.09) (0.12)
TRAIN –0.174 –0.039 –0.089 –0.059 –0.027 0.046 0.156 0.098

(0.22) (0.17) (0.09) (0.09) (0.19) (0.10) (0.10) (0.12)
constant –2.090 –6.208*** –2.276*** 0.217 –0.002 0.687 –2.072*** –2.828***

(1.28) (0.98) (0.54) (0.53) (1.12) (0.61) (0.55) (0.67)
indiv. controls Yes Yes Yes Yes Yes Yes Yes Yes
wrkpl-firm dum Yes Yes Yes Yes Yes Yes Yes Yes
21 region dum Yes Yes Yes Yes Yes Yes Yes Yes
40 sector dum Yes Yes Yes Yes Yes Yes Yes Yes
8 occup dum Yes Yes Yes Yes Yes Yes Yes Yes
10 org dum Yes Yes Yes Yes Yes Yes Yes Yes
R sq. 0.341 0.152 0.138 0.199 0.164 0.127 0.318 0.255
Notes: Standard errors in parenthesis; ***Significant at the 1% level **Significant at the 5% level *Significant at the 10 % level
SUR estimates. Number of observations: 3529 (due to missing values in the sector dummies). Breusch-Pagan test of independence: chi2(28) = 1805.265, Pr
= 0.0000. See Appendix for the list of controls
29
Table 4: Wage and commitment
Wage Strong commitment Value commitment

OLS ordered prob. marg.eff. ordered prob. marg.eff.
(1) (2) (3) (4) (5)
SUGGEST 0.009 0.052 0.005 0.124* 0.032

(0.02) (0.08) (0.08)
MEET 0.015 0.336*** 0.033 0.180*** 0.047
(0.01) (0.05) (0.05)
QC 0.015 0.288*** 0.031 0.234*** 0.061
(0.02) (0.08) (0.08)
QUALITY 0.007 –0.014 -0.001 –0.184*** -0.048
(0.01) (0.05) (0.05)
TEAM –0.014 –0.170** -0.016 –0.127 -0.033
(0.02) (0.09) (0.09)
TASK 0.061*** 0.409*** 0.050 0.352*** 0.092
(0.02) (0.10) (0.10)
GROUP –0.011 –0.018 -0.002 –0.129 -0.034
(0.02) (0.10) (0.10)
RESP –0.045** –0.301*** -0.027 –0.140 -0.037
(0.02) (0.09) (0.09)
contingent rewards
TEAMPAY –0.037* –0.257*** -0.021 –0.081 -0.021

(0.02) (0.10) (0.10)
EARN 0.090*** –0.149* -0.013 0.022 0.006
(0.02) (0.09) (0.09)
TRAIN –0.038* 0.015 0.001 0.114 0.030

(0.02) (0.09) (0.09)
relative wage
w 0.193** 0.018 0.039 0.010

(0.08) (0.08)
job attributes
accidents 0.003* –0.007 0.001

(0.00) (0.01) (0.01)
exhaustion –0.001 –0.030** 0.027**
(0.00) (0.01) (0.01)
effort intensity –0.004 –0.051** –0.039*
(0.01) (0.02) (0.02)
prob.unemployment –0.002 –0.019 –0.149***
(0.00) (0.02) (0.02)
repetitiveness –0.004* –0.008 –0.043***
(0.00) (0.01) (0.01)
supervision 0.005 0.036 –0.004
(0.01) (0.02) (0.03)
discretion –0.014 0.035 0.187***
(0.01) (0.05) (0.05)
autonomy –0.006 –0.066 0.111**
(0.01) (0.04) (0.04)
instrument for η 0.098** 0.275 –0.428**
(0.05) (0.20) (0.21)
constant 0.047
(0.12)
indiv. controls Yes Yes Yes

wrkpl-firm dum Yes Yes Yes
21 region dum Yes Yes Yes
40 sector dum Yes Yes Yes
10 org dum Yes Yes Yes
8 soc dum Yes Yes Yes
R sq.
N 3016 3016 3016
Notes: Standard errors in parenthesis; ***Significant at the 1% level **Significant at the 5% level *Significant at the 10 % level.
The marginal effects are computed for category 6; bold numbers indicate statistical significance at 10% or less. The cut points of the
ordered probits are not shown for reasons of space. See Appendix for the list of controls. The instrument for η is the first factor obtained
from the factor analysis performed on the SUR residuals using the principal factor method; it explains a proportion of 0.98 of the variance.
Number of observations are 3016 due to missing values in the wage and the sector dummies.
30
Table 5: Normalized marginal effects of empowerment practices and contingent rewards on commitment.
Direct and indirect effects
Strong Commitment Value Commitment
Intrinsic Wage Working Total Intrinsic Wage Working Total

motivation conditions Motivation conditions
(1) (2) (3) (4) (1) (2) (3) (4)
empowerment practices empowerment practices
TEAM+TASK 0.477 -0.033 0.008 0.451 SUGGEST 0.110 0.023 0.129 0.262
MEET 0.451 -0.028 0.012 0.436 MEET 0.159 0.004 0.063 0.226
QC 0.435 -0.092 0.005 0.347 TEAM+TASK 0.197 0.071 -0.066 0.202
TEAM+TASK+GROUP 0.453 -0.107 -0.045 0.301 TEAM+TASK+RESP 0.073 0.090 -0.064 0.100
TEAM+TASK+RESP 0.102 -0.001 0.015 0.115 QC 0.206 -0.047 -0.067 0.092
QUALITY -0.019 0.066 0.013 0.060 TEAM+TASK+GROUP 0.083 -0.053 -0.008 0.022
SUGGEST 0.069 -0.012 -0.029 0.028 SELFTEAM -0.041 -0.033 -0.006 -0.081
SELFTEAM 0.078 -0.075 -0.037 -0.035 QUALITY -0.163 0.015 0.035 -0.112
31
TEAM -0.222 0.146 -0.007 -0.083 TEAM -0.112 0.078 -0.120 -0.155
average emp. practices 0.203 -0.015 -0.007 0.180 average emp. practices 0.057 0.016 -0.011 0.062
contingent rewards contingent rewards

EARN -0.182 0.129 0.016 -0.038 APP EARN 0.020 0.062 0.029 0.111
TEAMPAY -0.295 -0.135 0.039 -0.392 TEAMPAY -0.072 -0.016 0.008 -0.080
average cont. monetary rew. -0.239 -0.003 0.027 -0.215 average cont. monetary rew. -0.026 0.023 0.018 0.015
TRAIN 0.020 -0.089 0.005 -0.065 APP TRAIN 0.101 0.005 0.038 0.145
Notes: The normalized marginal effects reported in the Table are obtained as the ratio between the marginal effects (dy/dx), computed for category 6, and the frequency
of the category. The normalization is computed in order to compare the effects of the practices across type of commitments; the frequency of category 6 is 29.6% for
value commitment and 7.2% for strong commitment. Total is the sum of the previous three columns. The marginal effects used in col.(1) are obtained from the marginal
effects of equation (9) and reported in column 1 of Table 9 in the appendix; the marginal effect used in col.(2) are obtained from the difference between the marginal
effect of equation (12) and those of equation (10); notice that the wage indirect effects also include the interacted wage-working conditions effects. The marginal effects
used in col.(3) are obtained from the difference between the marginal effects of equation (10) and those of equation (9). All marginal effects are reported in Table9 in
the appendix. SELFTEAM corresponds to TEAM+TASK+GROUP+RESP.
Table 6: Commitment by education. Ordered probit
Strong commitment Value commitment

(1) (2) (3) (4) (5) (6) (7) (8)
compulsory vocational technical tertiary compulsory vocational technical tertiary
SUGGEST 0.037 0.108 –0.099 –0.010 0.187 0.098 0.071 0.547**

(0.11) (0.15) (0.08) (0.24) (0.12) (0.16) (0.08) (0.25)
MEET 0.483*** 0.302** 0.098 –0.213 0.351*** 0.187 –0.076 0.013
(0.11) (0.14) (0.07) (0.23) (0.11) (0.15) (0.07) (0.24)
QC 0.729*** 0.228 0.089 0.011 0.181 –0.069 0.460*** –0.431
(0.19) (0.23) (0.11) (0.30) (0.19) (0.23) (0.11) (0.31)
QUALITY –0.021 0.042 –0.066 –0.496*** –0.439*** 0.389*** –0.191*** –0.089
(0.10) (0.14) (0.06) (0.18) (0.11) (0.15) (0.07) (0.19)
TEAM –0.466*** 0.268 –0.063 –0.695 –0.153 –0.173 –0.057 –0.046
(0.17) (0.26) (0.13) (0.51) (0.17) (0.27) (0.13) (0.51)
TASK 0.350* 0.122 0.400*** 1.073** 0.233 0.421 0.229 0.598
(0.20) (0.29) (0.15) (0.53) (0.20) (0.29) (0.15) (0.54)
GROUP 0.228 –0.723*** 0.273* –0.805** –0.142 –0.278 0.053 –0.003
(0.19) (0.27) (0.14) (0.34) (0.20) (0.28) (0.14) (0.35)
RESP –0.062 0.055 –0.538*** 0.571 0.190 –0.154 –0.407*** –0.277
32
(0.19) (0.27) (0.13) (0.37) (0.19) (0.28) (0.13) (0.39)
contingent rewards
TEAMPAY –0.854*** 0.208 –0.166 0.097 –0.552** –0.002 0.143 0.120

(0.25) (0.27) (0.13) (0.30) (0.25) (0.28) (0.13) (0.32)
EARN –0.189 0.143 –0.206* 0.269 0.275 –0.403 –0.088 0.422*
(0.23) (0.25) (0.12) (0.21) (0.24) (0.26) (0.12) (0.22)
TRAIN –0.539** –0.498** 0.391*** 0.043 –0.273 –0.155 0.442*** 0.175

(0.22) (0.24) (0.12) (0.23) (0.22) (0.25) (0.13) (0.24)
relative wage
w 0.323* 0.920*** –0.039 0.078 0.079 0.051 0.149 –0.194

(0.18) (0.22) (0.13) (0.30) (0.18) (0.23) (0.14) (0.31)
job attributes Yes Yes Yes Yes Yes Yes Yes Yes
other conts Yes Yes Yes Yes Yes Yes Yes Yes
wrkpl-firm dum Yes Yes Yes Yes Yes Yes Yes Yes
sector dum Yes Yes Yes Yes Yes Yes Yes Yes
org dum Yes Yes Yes Yes Yes Yes Yes Yes
N 751 462 1449 354 751 462 1449 354
Notes:Standard errors in parenthesis; ***Significant at the 1% level **Significant at the 5%

level *Significant at the 10 % level; see also Notes to Table 4.
A Appendix
Table 7: Types of teams
task output group task auto & output resp & task & group fully lean
autonomous responsible autonomous output resp group auto autonomous autonomous
TEAM 1 1 1 1 1 1 1 1
TASK 1 0 0 1 0 1 1 0
RESP 0 1 0 1 1 0 1 0
GROUP 0 0 1 0 1 1 1 0
nr. employees 245 102 10 203 7 45 802 184
% of total employees 6.80 2.83 0.28 5.63 0.19 1.25 22.25 5.10
% of team-workers 14.53 6.05 0.59 12.04 0.42 2.67 47.57 10.91
34
Table 8: Estimated reduced forms of commitment equations
(1) (2) (3) (4) (5) (6)

SUGGEST –0.014 0.030 0.019 0.151*** 0.274*** 0.300***

(0.05) (0.05) (0.04) (0.05) (0.05) (0.04)
QC 0.238*** 0.287*** 0.217*** 0.174** 0.160** 0.106
(0.07) (0.08) (0.07) (0.07) (0.08) (0.07)
MEET 0.273*** 0.340*** 0.297*** 0.189*** 0.255*** 0.259***
(0.05) (0.05) (0.04) (0.05) (0.05) (0.05)
QUALITY 0.028 –0.004 0.041 –0.168*** –0.146*** –0.128***
(0.04) (0.05) (0.04) (0.04) (0.05) (0.04)
TEAM –0.022 –0.172** –0.057 –0.063 –0.267*** –0.177**
(0.08) (0.08) (0.07) (0.08) (0.09) (0.08)
TASK 0.330*** 0.492*** 0.350*** 0.362*** 0.423*** 0.415***
(0.08) (0.10) (0.08) (0.09) (0.10) (0.09)
GROUP –0.102 –0.058 –0.106 –0.292*** –0.065 –0.205***
(0.08) (0.09) (0.08) (0.08) (0.09) (0.08)
RESP –0.241*** –0.290*** –0.241*** –0.085 –0.140 –0.117
(0.08) (0.09) (0.08) (0.08) (0.09) (0.08)
contingent rewards
TEAMPAY –0.354*** –0.214** –0.318*** –0.109 –0.073 –0.090

(0.08) (0.09) (0.08) (0.08) (0.10) (0.08)
EARN –0.036 –0.132 –0.026 0.109 0.055 0.127
(0.08) (0.08) (0.08) (0.08) (0.09) (0.08)
TRAIN –0.066 0.018 –0.045 0.120 0.160* 0.167**

(0.08) (0.08) (0.08) (0.08) (0.09) (0.08)
relative wage
w 0.185** 0.056
(0.08) (0.08)
job attributes
accidents –0.004 –0.001

(0.01) (0.01)
exhaustion –0.024** 0.014
(0.01) (0.01)
effort intensity –0.030 –0.033*
(0.02) (0.02)
prob unemployemnt –0.046*** –0.142***
(0.02) (0.02)
repetitiveness –0.015* –0.040***
(0.01) (0.01)
supervision 0.021 –0.017
(0.02) (0.02)
discretion 0.083** 0.182***
(0.03) (0.04)
autonomy –0.012 0.107***
(0.03) (0.03)
instrument for η 0.045 0.133*** –0.401*** 0.207***
(0.14) (0.03) (0.14) (0.03)
indiv conts Yes Yes Yes Yes Yes Yes

wrkpl-firm dum Yes Yes Yes Yes Yes Yes
21 region dum Yes Yes Yes Yes Yes Yes
40 sector dum Yes Yes Yes Yes Yes Yes
10 org dum Yes Yes Yes Yes Yes Yes
8 soc dum Yes Yes Yes Yes Yes Yes
R sq.
N 3529 3016 3529 3529 3016 3529
Notes: Standard errors in parenthesis; ***Significant at the 1% level **Significant at the 5% level *Significant at the 10 % level.
Ordered Probit estimates. The cut points of the ordered probits are not shown for reasons of space. See Appendix for the list of controls.
The instrument for η is the first factor obtained from the factor analysis performed on the SUR residuals using the principal factor
method; it explains a proportion of 0.94 of the variance.
35
Table 9: Marginal effects from the structural and the reduced form models

(1) (2) (3) (4) (1) (2) (3) (4)
practices
SUGGEST 0.005 -0.001 0.003 0.002 0.032 0.040 0.071 0.078
MEET 0.033 0.028 0.033 0.031 0.047 0.050 0.066 0.067
QC 0.031 0.027 0.032 0.025 0.061 0.046 0.041 0.027
QUALITY -0.001 0.003 0.000 0.004 -0.048 -0.045 -0.038 -0.033
TEAM -0.016 -0.002 -0.016 -0.006 -0.033 -0.017 -0.069 -0.046
TASK 0.050 0.036 0.051 0.038 0.092 0.095 0.108 0.106
GROUP -0.002 -0.010 -0.006 -0.011 -0.034 -0.077 -0.017 -0.053
RESP -0.027 -0.024 -0.026 -0.024 -0.037 -0.023 -0.036 -0.030
contingent rewards
TEAMPAY -0.021 -0.030 -0.018 -0.028 -0.021 -0.029 -0.019 -0.024
EARN -0.013 -0.004 -0.012 -0.003 0.006 0.029 0.014 0.033
TRAIN 0.001 -0.007 0.002 -0.005 0.030 0.032 0.041 0.043
relative wage
w 0.018 0.018 0.010 0.014
Notes: Columns 1 show the marginal effects from equation (9) in the text; columns 2 show the
marginal effects after substituting for the wage, corresponding to equation (11) in the text; columns
3 show the marginal effects after substituting for working conditions corresponding to equation (10)
in the text; columns 4 show the marginal effects after substituting for both the wage and working
conditions, corresponding to equation (12) in the text. Bold coefficients are significant at least at
10%. Recall that value and strong commitment are 1-7 categorical variables; the marginal effects
are relative to category 6; the frequency of value commitment in category 6 is 29.6% whereas the
frequency of strong commitment in the same category is 7.2%.
36
Table 10: The wage regression by educational attainments
compulsory vocational technical tertiary

(1) (2) (3) (4)
SUGGEST –0.019 –0.075** 0.016 0.047

(0.03) (0.04) (0.02) (0.05)
MEET –0.073*** 0.024 0.061*** –0.094**
(0.02) (0.03) (0.02) (0.04)
QC 0.036 –0.024 0.001 –0.001
(0.04) (0.05) (0.02) (0.06)
QUALITY 0.027 0.014 0.005 –0.069*
(0.02) (0.03) (0.01) (0.04)
TEAM 0.017 0.019 –0.073*** –0.132
(0.04) (0.06) (0.03) (0.10)
TASK –0.050 0.144** 0.070** 0.007
(0.04) (0.07) (0.03) (0.10)
GROUP 0.069 –0.211*** 0.020 –0.119*
(0.04) (0.06) (0.03) (0.07)
RESP –0.095** 0.017 0.005 0.181**
(0.04) (0.06) (0.03) (0.07)
contingent rewards
TEAMPAY –0.042 –0.013 0.013 –0.009

(0.06) (0.06) (0.03) (0.06)
EARN 0.169*** 0.118** 0.018 0.115***
(0.05) (0.06) (0.02) (0.04)
TRAIN –0.107** 0.013 –0.010 –0.023

(0.05) (0.06) (0.03) (0.04)
job attributes
accidents 0.005* 0.014*** –0.001 0.006

(0.00) (0.00) (0.00) (0.01)
exhaustion 0.009* 0.020*** –0.005 –0.004
(0.01) (0.01) (0.00) (0.01)
effort intensity –0.010 0.034** 0.002 0.020
(0.01) (0.01) (0.01) (0.01)
prob unemployement –0.011 –0.008 –0.012** –0.004
(0.01) (0.01) (0.01) (0.01)
repetitiveness –0.011*** –0.006 –0.001 –0.016*
(0.00) (0.01) (0.00) (0.01)
supervision –0.012 0.006 –0.007 0.004
(0.01) (0.02) (0.01) (0.01)
discretion 0.023 0.008 –0.001 0.088***
(0.02) (0.02) (0.01) (0.03)
autonomy 0.017 0.044** –0.004 –0.001
(0.01) (0.02) (0.01) (0.02)
instrument for η –0.036 –0.050 0.041 –0.031
(0.06) (0.09) (0.04) (0.08)
constant 5.324*** 6.221*** 4.929*** 6.086***
(0.24) (0.35) (0.16) (0.42)
oother conts Yes Yes Yes Yes
wrkpl-firm dum Yes Yes Yes Yes
sector dum Yes Yes Yes Yes
org dum Yes Yes Yes Yes
R sq. 0.632 0.553 0.639 0.831
N 751 462 1449 354
Notes: Standard errors in parenthesis; ***Significant at the 1% level **Significant at the

5% level *Significant at the 10% level. See Appendix for list of controls and Notes to Table
4.
37
Table 11: Values of λ to satisfy dΩ∗ /dπ > 0.
Intrinsic motivation Total Wage Working condition Values of λ (λ > 0) Notes

∂µ/∂π dw/dπ ∂d/∂π for dΩ∗ /dπ > 0
a3 ∆ a1
+ + + for all λ
+ + – λ > (b3 |a1 | − ∆)/(a3 − ∆) for all λ if a3 > ∆ > b3 |a1 |
for no λ if a3 < ∆ < b3 |a1 |
+ – + λ > (|∆| − b3 a1 )/(a3 + |∆|) for all λ if |∆| < b3 a1
+ – – λ > (|∆| + b3 a1 )/(a3 + |∆|) for sufficiently large λ
– + + λ < (∆ + b3 a1 )/(|a3 | + ∆) for sufficiently small λ
– + – λ < (∆ − b3 |a1 |)/(|a3 | + ∆) for no λ if ∆ < b3 |a1 |
– – + λ < (b3 a1 − |∆|)/(|a3 | + |∆|) for no λ if |∆| > b3 a1
– – – for no λ
.
Notes: For convenience we let: a3 = ∂µ/∂π, ∆ = dw/dπ, a1 = ∂d/∂π
Table 12: Classification of practices according to their estimated marginal effects.
Sign of the marginal effect on:

Intrinsic motivation Total Wage Working conditions Strong Commitment Value Commitment
α3 γ3 α2 + γ3 β2 A1 β3 A1
+ + + SUGG, MEET, TRAIN
+ + – TEAM+TASK, TEAM+RESP
+ – + TEAM+TASK, MEET, QC,TEAM+TASK+RESP, TRAIN
+ – – TEAM+TASK+GROUP, SUGG, SELFTEAM QC
– + + QUALITY, EARN QUALITY
– + – TEAM TEAM
– – + TEAMPAY TEAMPAY
– – – SELFTEAM
Notes: Practices are classified according to their estimated effects shown in Table 5. Bold
typeface indicate that the overall effect on commitment is positive.
38
Table 13: List of controls included in regressions
individual controls: firm and workplace controls:
female workplace located in the South

age union presence
age squared job prevalent female
experience job prevalent male
tenure wrkp size dummy2 (5 to 15)
high school vocational wrkp size dummy3 (15 to 50)
high school technical wrkp size dummy4 (more than 50)
high school university firm size dummy2 (15 to 100)
master/doctorate firm size dummy3 (100 to 500)
first degree firm size dummy4 (more than 500)
union member 40 sector dummies
full time job 21 region dummies
permanent job
commuting cost%
pension/insurance scheme
overeducation*
extent of pc use
skill level
shift work
supervisor
child dummy
child below 6 yrs dummy
married
divorced
nr. child
mother married
mother not married
8 occupational dummies
17 organizational area dummies
*Overeducation is given by the difference between the actual level of education and the respondent’s
assessment of the education level actually needed to cover the position she holds: positive values indicate excess
education, negative value indicate an educational deficit.
%
Commuting cost is computed on the basis of the distance between the county town of the workplace
location and the county town of residence and imputing the estimated cost of motoring.
39

Employees' Motivation and High Performance Workplace Practices

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Employees’ motivation and high performance workplace practices

JEL Classiﬁcations: J28 J33 J53 M54

Keywords: High Performance Workplace Practices, Motivation, Commitment, Wages,

BΩ = [λµ + (1 − λ)w] − c1 Ω (1)

w = g(π, d|z) (4)

Ω∗ = c−1 [λµ(π) + (1 − λ)w + b3 d] (5)

where z is a vector of exogenous variables (typically, the employee’s personal characteristics),

where dw/dπ = ∂w/∂π + ∂w/∂d · ∂d/∂π.

3.1 Innovative practices and employees’ commitment: descriptive evidence

4.1 Identiﬁcation and estimation strategy

Ωi = (α3 + β3 A1 )πi + γ3 wi + (ϕ3 + β3 Φ1 )zi + u3i + β3 u1i (10)

Ωi = (α3 + γ3 α2 )πi + (β3 + γ3 β2 )di + (ϕ3 + γ3 ϕ2 )zi + u3i + γ3 u2i (11)

Ωi = (α3 + γ3 α2 + γ3 β2 A1 + β3 A1 )πi + (ϕ3 + γ3 ϕ2 + β3 Φ1 + γ3 β2 Φ1 )zi + u (12)

where u = u3i + γ3 u2i + β3 u1i + γ3 β2 u1i

5.2 A further look at crowding out eﬀects: commitment by education

Etzioni, A. (1971) Modern Organizations. Englewood Cliﬀs, NJ: Prentice-Hall.

Greenan N. (1996) Innovation Technologique, Changements Organisationnels e Evolution

Guest D. and N. Conway(2007) Human Resource Management, Employee Attitudes and

ISFOL (2007) Organizzazione, Apprendimento e Competenze, Rapporto di Ricerca, ISFOL

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Kato T. and M. Morishima (2002) The Productivity Eﬀects of Participatory Employment

Leibenstein H. (1966) Allocative Eﬃciency vs. ’X-Eﬃciency’. American Economic Review

Lynch L. M. (2007) The Adoption And Diﬀusion Of Organizational Innovation: Evidence

Osterman P. (2000) Work Reorganization in an era of Restructuring: Trends in Diﬀusion

Nickell S. (1996) Competition and Corporate Performance. Journal of Political Economy

Pfeﬀer J. (2007) Human Resources from an Organizational Behavior Perspective: Some

Simon H. A. (1991) Organizations and Markets. Journal of Economic Perspectives 5(2),

Tomassini M. (ed) (2006) Organizzazione, apprendimento, competenze. Indagine sulle com-

Wood S. and L. De Menezes (1998) High Commitment Management in Britain: Evidence

All employees Compulsory Vocational Technical Tertiary

SUGGEST 0.71 0.58 0.65 0.75 0.86

EARN 0.13 0.06 0.06 0.15 0.29

TRAIN 0.10 0.08 0.08 0.10 0.19

nr. observations 3605 878 538 1709 480

Notes: Compulsory: 10 years of schooling; vocational secondary: 1 to 3 years of post-

(1) (2) (3) (4) (5) (6) (7) (8) (9)

Notes: Number of observations: 3605. **Signiﬁcant at the 5% level or less *Signiﬁcant at

Physical working conditions Job security Job content

SUGGEST 0.130 0.151 0.083 –0.168*** –0.375*** –0.089 0.401*** 0.418***

TEAMPAY –0.120 –0.643*** –0.100 –0.346*** –0.012 0.198* –0.069 –0.126

TRAIN –0.174 –0.039 –0.089 –0.059 –0.027 0.046 0.156 0.098

constant –2.090 –6.208*** –2.276*** 0.217 –0.002 0.687 –2.072*** –2.828***

Wage Strong commitment Value commitment

SUGGEST 0.009 0.052 0.005 0.124* 0.032

TEAMPAY –0.037* –0.257*** -0.021 –0.081 -0.021

TRAIN –0.038* 0.015 0.001 0.114 0.030

w 0.193** 0.018 0.039 0.010

accidents 0.003* –0.007 0.001

indiv. controls Yes Yes Yes

Strong Commitment Value Commitment

Intrinsic Wage Working Total Intrinsic Wage Working Total

contingent rewards contingent rewards

Strong commitment Value commitment

SUGGEST 0.037 0.108 –0.099 –0.010 0.187 0.098 0.071 0.547**

TEAMPAY –0.854*** 0.208 –0.166 0.097 –0.552** –0.002 0.143 0.120

TRAIN –0.539** –0.498** 0.391*** 0.043 –0.273 –0.155 0.442*** 0.175

w 0.323* 0.920*** –0.039 0.078 0.079 0.051 0.149 –0.194

Notes:Standard errors in parenthesis; ***Signiﬁcant at the 1% level **Signiﬁcant at the 5%

Strong commitment Value commitment

(1) (2) (3) (4) (5) (6)

SUGGEST –0.014 0.030 0.019 0.151*** 0.274*** 0.300***

TEAMPAY –0.354*** –0.214** –0.318*** –0.109 –0.073 –0.090

SUGGEST 0.130 0.151 0.083 –0.168* –0.375* –0.089 0.401* 0.418*

TEAMPAY –0.120 –0.643* –0.100 –0.346* –0.012 0.198* –0.069 –0.126

constant –2.090 –6.208* –2.276* 0.217 –0.002 0.687 –2.072* –2.828*

TEAMPAY –0.854* 0.208 –0.166 0.097 –0.552 –0.002 0.143 0.120

TRAIN –0.539 –0.498 0.391* 0.043 –0.273 –0.155 0.442* 0.175

Notes:Standard errors in parenthesis; *Signiﬁcant at the 1% level Signiﬁcant at the 5%

SUGGEST –0.014 0.030 0.019 0.151* 0.274* 0.300***

TEAMPAY –0.354* –0.214 –0.318*** –0.109 –0.073 –0.090

Notes: Standard errors in parenthesis; *Signiﬁcant at the 1% level Signiﬁcant at the