The Economy of Incentives by Chester Barnard

| April 16, 2015

The Economy of Incentives by Chester Barnard

Chester bases his arguments on the power of using incentives in organizations. Incentives are a powerful tool for persuasion to employees. He argues that introducing or using incentives in an organization leads to increased productivity, because there is an increase in employee motivation. An increase in individual efforts results in an overall increase in organizational performance. Additionally, cooperation or teamwork is a vital part of an organization. Chester points out that individuals willingly contribute their efforts towards an organization because of the sense of belonging. Employees will feel that they belong to an organization if they feel they have a stake in it. As such, incentives represent the way of showing that the employer cares for the employee and that they belong together.


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