Chapter Questions
Distinguish policies on external competitiveness from policies on internal alignment. Why is external competitiveness so important?
What factors shape an organization's external competitiveness?
What does marginal revenue product have to do with pay?
What pay level does the efficiency wage predict? Does the theory accurately predict organization behavior? Why or why not?
What is a relevant market? What difference does it make when determining people's pay?
Can you think of any companies that follow a lag and/or lead policy? Why do they believe it pays to pay differently? Can you think of any companies that follow performance driven and/or work/life balance policies?