Exploring the Effect of Culture on How Pay-For-Performance Affects Turnover: A Multi-Level Longitudinal Study on 24 Countries

Abstract

While research has shown that pay-for-performance plans affect the curvilinear relationship between performance and turnover, all of this research has been conducted on samples of employees from the United States. In this paper, we explore the potential moderating effects of culture. Specifically, we predict that we will replicate (1) the curvilinear relationship between performance and turnover, and (2) the moderating effects of pay-for-performance; but also (3) that culture will affect the nature of these relationships. We test our hypotheses on a sample of 4072 employees from 24 countries, and analyze our data with non-linear HLM models.