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Discussion Paper Details

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Title: The Effect of Incentives in Non-Routine Analytical Team Tasks - Evidence from a Field Experiment

Author(s): Florian Englmaier, Stefan Grimm, David Schindler and Simeon Schudy

Publication Date: October 2018

Keyword(s): bonus, exploration, gain, incentives, loss, non-routine and team work

Programme Area(s): Industrial Organization

Abstract: Despite the prevalence of non-routine analytical team tasks in modern economies, little is known about how incentives influence performance in these tasks. In a field experiment with more than 3000 participants, we document a positive effect of bonus incentives on the probability of completion of such a task. Bonus incentives increase performance due to the reward rather than the reference point (performance threshold) they provide. The framing of bonuses (as gains or losses) plays a minor role. Incentives improve performance also in an additional sample of presumably less motivated workers. However, incentives reduce these workers' willingness to "explore" original solutions.

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Bibliographic Reference

Englmaier, F, Grimm, S, Schindler, D and Schudy, S. 2018. 'The Effect of Incentives in Non-Routine Analytical Team Tasks - Evidence from a Field Experiment'. London, Centre for Economic Policy Research. https://cepr.org/active/publications/discussion_papers/dp.php?dpno=13226