The Moderating Effects of Task Complexity and Task Attractiveness on the Impact of Monetary Incentives in Repeated Tasks

Abstract:     
This study examines the interactive effects of task complexity and attractiveness on the effectiveness of explicit monetary incentives in promoting task performance. We provide theory for and find an interaction such that monetary incentives are more effective when tasks are less complex, but only when the task is viewed as relatively unattractive. In addition, by varying task complexity, this study extends Bailey et al. (1998), finding that when incentive pay leads to higher performance, it is through faster initial performance, not faster improvement

Keywords: Monetary incentives, Task attractiveness, Performance, Learning, Task characteristics

JEL Classification: M52

Accepted Paper Series