Title: Employee Perceptions of Compensation and the Trade-Off Between Wages and Workplace Perks

Abstract

This study investigates the influence of workers’ perceptions regarding compensation on their willingness to exchange salary for workplace amenities. We utilize a multi-stage, incentivized survey experiment that integrates hypothetical choice scenarios with the measurement of beliefs concerning actual starting salaries. The design also incorporates random variations in the disclosure of explicit pay data.

Our findings indicate that while stated preferences reveal a substantial willingness to pay for amenities—aligning with previous research—baseline beliefs about real-world salaries exhibit systematic biases across two key dimensions. Specifically, participants underestimate starting salaries by 18% and incorrectly anticipate that jobs with superior amenities command higher wages, thereby significantly overestimating the positive correlation between amenities and pay.

Providing explicit pay information increases mean pay beliefs for comparable roles by 4% and decreases the variance in these beliefs by 15%. However, this information intervention does not weaken the strong positive link between perceived compensation and advertised amenities. Consequently, the amenity-pay trade-offs observed in stated choices remain largely unaffected. The results suggest that although employees place high value on workplace perks, their perceived trade-offs diverge significantly from the realities that would exist under conditions of full information.

Source: arXiv Generated at: 2026-06-02 00:00:00 UTC