Which of the Following Is NOT a Reason the Incentive

question 6

Multiple Choice

Which of the following is NOT a reason the incentive effects of OIP schemes are difficult to measure?

• A) Cross-sectional data inherently involves comparisons of different workers at the same point in time.
• B) It is impossible to discern whether the observed earnings differences in cross sectional data result from incentives to work harder or from systematic unobserved differences in workers who select into different earnings schemes.
• C) Theoretically,workers with higher abilities will tend to select into OIP schemes.
• D) Workers with higher ability are able to produce more output.
• E) Workers do not increase effort under OIP schemes.

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Definitions:

Industrial Corporation

A large company involved in the manufacturing or production of goods on a large scale, often employing many people and having significant economic influence.

Inequality

The unequal distribution of resources, wealth, opportunities, and rights among individuals or groups in a society.

Native Americans

The indigenous peoples of the United States, including both American Indian and Alaska Native groups.

U.S. Citizens

Individuals who are legally recognized as members of the United States, either by birth or naturalization, and are entitled to rights and privileges under the U.S. Constitution.