What Are the Two Major Limitations of Objective Incentive Payment

question 1

Multiple Choice

What are the two major limitations of objective incentive payment (OIP) schemes?

• A) OIP schemes encourage an emphasis on quantity at the expense of quality and the firm must use costly monitoring technology.
• B) Most professions have output that is easy to quantify and the firm must use costly monitoring technology.
• C) OIPs encourage shirking and the firm must use costly monitoring technology.
• D) OIP schemes do not encourage productivity as much as wages do and the firm cannot measure subjective quality.
• E) OIPs encourage an emphasis on quantity at the expense of quality and the firm cannot measure subjective quality.

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Definitions:

Whole-concept Processing

An approach in cognitive science suggesting people perceive and interpret complex information as complete wholes rather than breaking it down into component parts.

Code-based Processing

Involves deciphering information based on symbolic systems or codes, such as language or mathematics.

Information Processing Approach

describes a cognitive psychology theory that likens human thought processes to the operations of a computer, focusing on how information is taken in, processed, stored, and retrieved.

Empirically Tested

Refers to methods, theories, or measures that have been tested through empirical research, involving observation and experiment.