Quota Bonuses as Localized Sales Bonuses |
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| Authors: | Barna Bakó András Kálecz‐Simon |
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| Affiliation: | 1. Department of Microeconomics, MTA‐BCE ‘Lendület’ Strategic Interactions Research Group, Corvinus University of Budapest, Budapest, Hungary;2. Department of Macroeconomics, Corvinus University of Budapest, Budapest, Hungary |
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| Abstract: | In this article, we compare quota bonuses to profit‐based evaluation and sales (quantity) bonuses in a duopoly setting with independent demand shocks. Contrary to the previous findings, we find that under certain circumstances, either quota bonuses or sales bonuses may be optimal compensation plans. This may explain the coexistence of different bonus schemes in situations where the strategic aspect of the incentive problems is relevant. Copyright © 2017 John Wiley & Sons, Ltd. |
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