Table of Contents

The Economics of Motivation and Organization

The Economics of Motivation and Organization

An Introduction

Peter-J. Jost

In this unique book, Peter-J. Jost provides a comprehensive economic-psychological approach for successfully managing employees. Based on the analysis of the employee’s individual work behavior, he illustrates that instead of treating employees as input elements of production, and managing and controlling their work, organizations need to motivate their employees to act in the interest of the firm and in accordance with its goals.

Chapter 5: The Economic Analysis of the Motivation Problem

Peter-J. Jost

Subjects: business and management, strategic management, economics and finance, economic psychology


A Monty Python sketch keeps coming back to you. The two characters are a banker (played by John Cleese) and a Mr. Ford (played by Terry Jones), who is collecting money for charity with a tin cup. Banker: How do you do. Iím a merchant banker. Ford: How do you do Mr. ... Banker: Er ... I forgot my name for a moment but I am a merchant banker. Ford: Oh. I wondered whether youíd like to contribute to the orphanís home. (He rattles his tin.) Banker: Well I donít want to show my hand too early, but actually here at Slater Nazi we are quite keen to get into orphans, you know, developing market and all that ... what sort of sum did you have in mind? Ford: Well ... er ... youíre a rich man. Banker: Yes, I am. Yes, very, very, very, very, very, very, very, very, very, very, very rich. Ford: So er, how about a pound? Banker: A pound. Yes, I see. Now this loan would be secured by the ... Ford: Itís not a loan, sir. Banker: What? Ford: Itís not a loan. Banker: Ah. Ford: You get one of these, sir. (He gives him a flag.) Banker: Itís a bit small for a share certificate isnít it? Look, I think Iíd better run this over to our legal department. If you could possibly pop back on Friday. Ford: Well, do you have to do that, couldnít you just give me a pound? Banker: Yes, but you see I donít know what it is for. Ford: Itís for the orphans. Banker: Yes? Ford: Itís a gift. Banker: A what? Ford: A gift? Banker: Oh a gift! Ford: Yes. Banker: A tax dodge. Ford: No, no, no, no. Banker: No? Well, Iím awfully sorry I donít understand. Can you explain exactly what you want? Ford: Well, I want you to give me a pound, and then I go away and give it to the orphans. Banker: Yes? Ford: Well, thatís it. Banker: No, no, no, I donít follow this at all, I mean, I donít want to seem stupid but it looks to me as though Iím a pound down on the whole deal. Ford: Well, yes you are. Banker: I am! Well, what is my incentive to give you the pound? Ford: Well, the incentive is - to make the orphans happy. Banker: (genuinely puzzled) Happy? ... Are you quite sure youíve got this right? Ford: Yes, lots of people give me money. Banker: What, just like that? Ford: Yes. Banker: Must be sick. I donít suppose you could give me a list of their names and addresses could you? Ford: No, I just go up to them in the street and ask. Banker: Good lord! Thatís the most exciting new idea Iíve heard in years! Itís so simple itís brilliant! Well, if that idea of yours isnít worth a pound Iíd like to know what is. (He takes the tin from Ford.) 263 Ford: Oh, thank you sir. Banker: The only trouble is, you gave me the idea before Iíd given you the pound. And thatís not good business. Ford: It isnít? Banker: No, Iím afraid it isnít. So, um, off you go. (He pulls a lever opening a trap door under Fordís feet and Ford falls through with a yelp.) Nice to do business with you. (Chapman, 1989)

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