Payment Schemes and Gender in Germany

Abstract

The authors estimate the determinants of five types of variable payment schemes using panel data on German establishments in 1994 and 1996. Women were disproportionately included in schemes based on individual productivity and on profit-sharing, but not in those based on work group productivity. This pattern seems inconsistent with the claim that women are sorted due to their shorter expected tenure. Instead, the authors argue, the critical issue may be that women have a greater need for flexibility between work and home than men do. Collective bargaining coverage and other industrial relations variables are shown to be influential determinants interacting with gender.