Generational differences in perception of incentives in Germany - Evidence from the German Socio-Economic Panel on Generation Y

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School of Business | Master's thesis
Degree programme
50 + 9
Recent popular and academic literature has often pointed out that Generation Y is different to other generations in work-related issues. Especially the topic rewards and recognition is an interesting area of work-related generational research that has not yet been much explored. Further, only few studies have succeeded in using rich methodological approaches that are able to detangle generation-effects from age- and period-effects and thereby finding valuable results. Also, most studies have been conducted in North America, so that a lack of intercultural comparability has been identified. Therefore, there is a dearth in literature on how Generation Y is actually different from other genera-tions from reliable sources. This master thesis puts to the test, whether Generation Y in Germany has different perceptions of incentives compared to Generation X. For this purpose time-lag data as well as cross-sectional data is obtained from the German Socio-Economic Panel from the years 2002, 2015 and 2016 to test the research question. The results reveal generational differences in the perception of incentives to some extent. Is has been found that Generation Y is more satisfied with their job, less interested in monetary incentives, more interested in working less hours (taking into account the reduction of salary) and reacts with a stronger increase in satisfaction with the job when receiving a performance assessment compared to the precursory Generation X. Based on these re-sults a first hint for practitioners can be given on how to design incentive schemes for Millennials in Germany. Further in-depth research on incentive preferences, conducted in time-lag or longitudinal set-ups is still needed to verify these results.
Thesis advisor
Ikäheimo, Seppo
generational differences, Generation Y, Generation X, incentives
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