Pay Takes Flight! An Experiential Compensation Exercise

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Abstract
Teaching compensation system principles to undergraduate students who have limited practical experience can be challenging. We describe an exercise that puts students in the roles of compensation system designer and organization employee. This one-session exercise prompts students to create a compensation system for a fictitious paper airplane organization, then work as an employee (i.e., make paper airplanes). The exercise is particularly useful for demonstrating the sorting and incentive effects of compensation systems. This exercise is intended for undergraduate students in a human resource management or compensation course.

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