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J Appl Psychol. 2006 Jan;91(1):156-65.

The impact of financial and nonfinancial incentives on business-unit outcomes over time.

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  • 1Department of Management, Richard T. Farmer School of Business, Miami University, USA.


Unlike previous behavior management research, this study used a quasi-experimental, control group design to examine the impact of financial and nonfinancial incentives on business-unit (21 stores in a fast-food franchise corporation) outcomes (profit, customer service, and employee turnover) over time. The results showed that both types of incentives had a significant impact on all measured outcomes. The financial incentive initially had a greater effect on all 3 outcomes, but over time, the financial and nonfinancial incentives had an equally significant impact except in terms of employee turnover.

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