ABSTRACT
WHETHER people work more efficiently and with greater satisfaction when there is a direct financial incentive, such as that provided by piece-rate systems, can be considered an open question. Indeed, it is unlikely that such a question can be answered by itself, because the way people are paid is only one facet of a large number of interdependent sociological, technological, psychological, economic, and cultural variables which interpenetrate to create social climate, and community morale in industry. An opportunity to study this problem in some detail occurred, when in January, 1949, the Research Team received a request jointly from the management and the workers in the Service Department to assist them with discussions on whether or not they should switch over from piece-rates to hourly wage rates. 1
