Consumers Punish Firms that Cut Employee Pay in Response to COVID-19

Published: Jan 1, 2020
Abstract
Two experiments, including one incentive compatible study, examine the impact of cutting pay for executives versus employees in response to COVID-19 on consumer behavior. Study 1 explores the effect of announcing cuts or no cuts to CEO and employee pay, and shows that firms’ commitment to paying employees their full wages leads to the most positive consumer reactions. Study 2 further examines the effects of announcing employee and CEO pay cuts:...
Paper Details
Title
Consumers Punish Firms that Cut Employee Pay in Response to COVID-19
Published Date
Jan 1, 2020
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