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  • 2019
  • Working Paper
  • HBS Working Paper Series

From Dollars to Sense: Placing a Monetary Value on Non-Cash Compensation Encourages Employees to Value Time over Money

By: Ashley V. Whillans, Ryan Dwyer, Jaewon Yoon and Allan Schweyer
  • Format:Print
  • | Language:English
  • | Pages:68
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Abstract

When deciding where to work, employees may focus too much on salary and not enough on non-cash benefits such as paid time-off, potentially undermining their long-term happiness. We propose a simple solution to encourage employees to recognize the value of non-cash benefits: list the financial value of non-cash compensation. Results from one archival data set (n = 42,271) and eight studies (n = 3,190) provide evidence for these ideas. First, as expected, employees who receive non-cash compensation are happier than employees who do not. Yet, prospective employees underestimate the happiness benefit of non-cash benefits. Second, and most critically, prospective employees are more likely to choose jobs with greater non-cash benefits and lower salaries when the cash value of these non-cash benefits are listed. Providing a mechanism for our results: organizations that list the cash value of non-cash benefits are perceived as caring more about their employees and about work-life balance. We document a boundary condition: listing the cash value of non-cash rewards effectively shifts employment preferences only when the starting salary of the job is sufficiently high. These findings provide the first evidence that listing the cash value of non-cash rewards increases the attractiveness of non-cash compensation.

Keywords

Non-cash Compensation; Salary; Benefits; Time; Money; Compensation And Benefits; Wages; Work-life Balance; Perception; Decision Making; Happiness

Citation

Whillans, Ashley V., Ryan Dwyer, Jaewon Yoon, and Allan Schweyer. "From Dollars to Sense: Placing a Monetary Value on Non-Cash Compensation Encourages Employees to Value Time over Money." Harvard Business School Working Paper, No. 18-059, January 2018. (Updated January 2019.)
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About The Author

Ashley V. Whillans

Negotiation, Organizations & Markets
→More Publications

More from the Authors

    • March 29, 2021
    • Harvard Business Review (website)

    Research: A Little Recognition Can Provide a Big Morale Boost

    By: Shibeal O'Flaherty, Michael Sanders and Ashley V. Whillans
    • 2021
    • Faculty Research

    Extension Request Avoidance Increases Time Stress among Women

    By: Ashley V. Whillans, Jaewon Yoon, Aurora Turek and Grant E. Donnelly
    • March 23, 2021
    • Proceedings of the National Academy of Sciences

    A Multicountry Perspective on Gender Differences in Time Use During COVID-19

    By: Ashley V. Whillans, Laura M. Giurge and Ayse Yemiscigil (shared authorship)
More from the Authors
  • Research: A Little Recognition Can Provide a Big Morale Boost By: Shibeal O'Flaherty, Michael Sanders and Ashley V. Whillans
  • Extension Request Avoidance Increases Time Stress among Women By: Ashley V. Whillans, Jaewon Yoon, Aurora Turek and Grant E. Donnelly
  • A Multicountry Perspective on Gender Differences in Time Use During COVID-19 By: Ashley V. Whillans, Laura M. Giurge and Ayse Yemiscigil (shared authorship)
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