Can higher rewards lead to less effort? Incentive reversal in teams
نویسندگان
چکیده
منابع مشابه
Can Higher Bonuses Lead to Less Effort? Incentive Reversal in Teams
Conventional wisdom suggests that an increase in monetary incentives should induce agents to exert higher effort. In this paper, however, we demonstrate that this may not hold in team settings. In the context of sequential team production with positive externalities between agents, incentive reversal might occur: an increase in monetary incentives (either because rewards increase or effort cost...
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I t is commonly held that increasing monetary rewards enhance work effort. This study, however, argues that this will not ineludibly occur in team activities. Incentive Reversal may occur in sequential team productions featuring positive external impacts on agents. This seemingly paradoxical event is explained through two experiments in this article. The first experiment involves a sample ...
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By incentive reversal we refer to situations in which an increase of rewards for all agents results in fewer agents exerting effort. We show that externalities among peers may give rise to such intriguing situations even when all agents are fully rational. We provide a necessary and sufficient condition on the organizational technology in order for it to be susceptible to incentive reversal. Th...
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ژورنال
عنوان ژورنال: Journal of Economic Behavior & Organization
سال: 2014
ISSN: 0167-2681
DOI: 10.1016/j.jebo.2013.10.010