AGENCY THEORY VS. INFORMATION MEASUREMENT THEORY: A CASE STUDY ON THE EFFECTIVENESS OF INCENTIVES IN THE WORKPLACE

This study analyzes the impact of incentive programs on performance. Agency theory and Information Measurement theory are used to hypothesize about the impact of incentives upon performance. Empirical evidence from the case study shows that incentives are ineffective at increasing performance, but the statistical significance of the data is too low to generalize the findings beyond that of short term cold call sales. Several avenues for continued research are suggested.