Problem

Lack of response to monetary incentives

Other Names:
Failure of wage incentives
Nature:
The modern industrial system assumes a certain response by workers to wage incentives. However, this cannot be taken for granted among peasant populations or other traditional groups of the agrarian society from which industrial manpower has to be drawn in developing countries. Wage incentives may have relatively little appeal to people whose economic organization has been of a non-monetary nature and who find their satisfactions chiefly in traditional rewards, whether economic or via recognition and prestige. Customary types of consumption may lead to money being regarded as no more than a means of fulfilling certain limited requirements. Thus, in addition to the expected limitations of the potential labour supply due to ignorance and ill-health, the flow of workers into industry in developing countries may also be subject to powerful restraints arising from different expectations and cultural patterns of the population.
Problem Type:
D: Detailed problems
Date of last update
05.06.2000 – 00:00 CEST