The results are in, and they're unclear:
http://www.dallasnews.com/sharedcontent/dws/news/texassouthwest/stories/DN-incentives_05tex.ART.State.Edition1.4a83c96.html
The lower turnover rate among recipients of merit pay is an interesting point. It's like an element of Positive Behavior Support--positive recognition for achievement is a powerful motivator in behaviorism.
The debate continues....
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