The relationship between pay dispersion among R&D employees and firm R&D peformance

Victor Cui, Yoshio Yanadori

Research output: Contribution to conferencePaper

Abstract

Empirical research on the relationship between firm pay dispersion and workforce performance yields mixed findings. In an effort to disentangle the theoretical and empirical contradiction of pay dispersion research, this study examined the relationship between pay dispersion among R&D employees and firm R&D performance using employee-level pay data collected from US hightechnology firms during the 1997-2002 period. Our results revealed that the relationship between pay dispersion and firm R&D performance took an inverted U-shaped curve. Increasing the range of pay dispersion is beneficial at the beginning but once its range goes beyond a certain point, further increasing the range is detrimental. Unlike the authors' expectation, the negative effect of large pay dispersion is attenuated when the US economy was declining (i.e., in 2001 and 2002).

Original languageEnglish
Publication statusPublished - 2010
Externally publishedYes
Event70th Annual Meeting of the Academy of Management - Dare to Care: Passion and Compassion in Management Practice and Research, AOM 2010 - Montreal, QC, Canada
Duration: 2010 Aug 62010 Aug 10

Conference

Conference70th Annual Meeting of the Academy of Management - Dare to Care: Passion and Compassion in Management Practice and Research, AOM 2010
CountryCanada
CityMontreal, QC
Period10/8/610/8/10

Keywords

  • Compensation
  • High technology firms
  • Pay dispersion

ASJC Scopus subject areas

  • Management of Technology and Innovation
  • Industrial relations

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  • Cite this

    Cui, V., & Yanadori, Y. (2010). The relationship between pay dispersion among R&D employees and firm R&D peformance. Paper presented at 70th Annual Meeting of the Academy of Management - Dare to Care: Passion and Compassion in Management Practice and Research, AOM 2010, Montreal, QC, Canada.