The Effect of Incentives in Non-Routine Analytical Team Tasks

94 Pages Posted: 19 Apr 2018

See all articles by Florian Englmaier

Florian Englmaier

Ludwig Maximilian University of Munich (LMU) - Faculty of Economics

Stefan Grimm

Ludwig Maximilian University of Munich (LMU) - Faculty of Economics

David Schindler

Tilburg University

Simeon Schudy

University of Munich (LMU)

Date Written: February 21, 2018

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 series of field experiments with more than 5,000 participants, we investigate how incentives alter behavior in teams working on such a task. We document a positive effect of bonus incentives on performance, even among strongly intrinsically motivated teams. Bonuses also transform team organization as they enhance teams’ demand for leadership. Exogenously increasing the demand for leadership establishes a causal link that explains a large part of the observed bonus-induced performance improvements.

Keywords: team work, bonus, incentives, loss, gain, non-routine, exploration

JEL Classification: C920, C930, J330, D030, M520

Suggested Citation

Englmaier, Florian and Grimm, Stefan and Schindler, David and Schudy, Simeon, The Effect of Incentives in Non-Routine Analytical Team Tasks (February 21, 2018). CESifo Working Paper Series No. 6903, Available at SSRN: https://ssrn.com/abstract=3164800 or http://dx.doi.org/10.2139/ssrn.3164800

Florian Englmaier

Ludwig Maximilian University of Munich (LMU) - Faculty of Economics ( email )

Ludwigstrasse 28 III/ VG
D-80539 Munich
Germany

Stefan Grimm

Ludwig Maximilian University of Munich (LMU) - Faculty of Economics ( email )

Ludwigstrasse 28
Munich, D-80539
Germany

David Schindler

Tilburg University ( email )

P.O. Box 90153
Tilburg, 5000 LE
Netherlands

Simeon Schudy (Contact Author)

University of Munich (LMU) ( email )

Ludwigstrasse 28
Munich, D-80539
Germany
+49 89 2180 9786 (Phone)

Do you have negative results from your research you’d like to share?

Paper statistics

Downloads
401
Abstract Views
2,097
Rank
127,142
PlumX Metrics