Management of the new pay systems in the public sector ? some implications of insights gained from experiments

Abstract

During the last decades new pay systems have been widely introduced in the OECD countries. Experiments draw attention to some aspects which are normally not included in analyses of the new pay systems, namely fairness and reciprocity. Furthermore, the experiments indicate another understanding of what are perceived as gains and losses than what is assumed in conventional economic theory, and an asymmetric evaluation of gains and losses. These insights have important implications for the management of the new pay systems in the public sector.