Incentive Systems in a Real Effort Experiment

30 Pages Posted: 31 Mar 2001

See all articles by F. A. A. M. Van Winden

F. A. A. M. Van Winden

University of Amsterdam - Amsterdam School of Economics (ASE); CESifo (Center for Economic Studies and Ifo Institute); Tinbergen Institute

Frans van Dijk

University of Amsterdam - Amsterdam School of Economics (ASE)

Joep Sonnemans

University of Amsterdam - Amsterdam School of Economics (ASE)

Date Written: March 2000

Abstract

In the reported experiment different payment schemes are examined on their incentive effects. Payment based on individual, team and relative performance are compared. Subjects conducted computerized tasks that required substantial effort. The results show that individual and team payment induced the same effort levels. In team production free-riding occurred, but it was compensated by many subjects providing more effort than in case of individual pay. Effort was higher, but more variable in tournaments, while in case of varying abilities workers with relatively low ability worked very hard and drove up effort of the others. Finally, attitudes towards work and other workers differed strongly between conditions.

Keywords: Payment Schemes, Experiment

JEL Classification: J3, J33

Suggested Citation

Van Winden, F. A. A. M. and van Dijk, Frans and Sonnemans, Joep, Incentive Systems in a Real Effort Experiment (March 2000). Available at SSRN: https://ssrn.com/abstract=263942 or http://dx.doi.org/10.2139/ssrn.263942

F. A. A. M. Van Winden (Contact Author)

University of Amsterdam - Amsterdam School of Economics (ASE) ( email )

Roetersstraat 11
Amsterdam, North Holland 1018 WB
Netherlands

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

Tinbergen Institute ( email )

Gustav Mahlerplein 117
Amsterdam, 1082 MS
Netherlands

Frans Van Dijk

University of Amsterdam - Amsterdam School of Economics (ASE) ( email )

Roetersstraat 11
Amsterdam, North Holland 1018 WB
Netherlands

Joep Sonnemans

University of Amsterdam - Amsterdam School of Economics (ASE) ( email )

Roetersstraat 11
1018 WB Amsterdam
Netherlands
+31 20 525 4249 (Phone)
+31 20 525 5283 (Fax)

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