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Social and Behavioral Sciences Commons™
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Articles 1 - 9 of 9
Full-Text Articles in Social and Behavioral Sciences
Working Too Much For Too Little: Stochastic Rewards Cause Work Addiction, Brice Corgnet, Simon Gaechter, Roberto Hernán González
Working Too Much For Too Little: Stochastic Rewards Cause Work Addiction, Brice Corgnet, Simon Gaechter, Roberto Hernán González
ESI Working Papers
People are generally assumed to shy away from activities generating stochastic rewards, thus re-quiring extra compensation for handling any additional risk. In contrast with this view, neurosci-ence research with animals has shown that stochastic rewards may act as a powerful motivator. Applying these ideas to the study of work addiction in humans, and using a new experimental paradigm, we demonstrate how stochastic rewards may lead people to continue working on a re-petitive and effortful task even after monetary compensation becomes saliently negligible. In line with our hypotheses, we show that persistence on the work task is especially pronounced when the …
Labor Contracts, Gift-Exchange And Reference Wages: Your Gift Need Not Be Mine!, Hernán Bejerano, Brice Corgnet, Joaquín Gómez-Miñambres
Labor Contracts, Gift-Exchange And Reference Wages: Your Gift Need Not Be Mine!, Hernán Bejerano, Brice Corgnet, Joaquín Gómez-Miñambres
ESI Working Papers
We extend Akerlof’s (1982) gift-exchange model to the case in which reference wages respond to changes in the work environment such as those related to unemployment benefits or workers’ productivity levels. Our model shows that these changes spur disagreements between workers and employers regarding the value of the reference wage. These disagreements tend to weaken the gift-exchange relationship thus reducing production levels and wages. We find support for these predictions in a controlled, yet realistic, workplace environment. Our work also sheds light on several stylized facts regarding employment relationships such as the increased intensity of labor conflicts when economic conditions …
Give Me A Challenge Or Give Me A Raise, Aleksandr Alekseev
Give Me A Challenge Or Give Me A Raise, Aleksandr Alekseev
ESI Working Papers
I study the effect of task difficulty on workers' effort and compare it to the effect of monetary rewards in an incentivized lab experiment. I find that task difficulty has an inverse-U effect on effort, and that this effect is quantitatively large when compared to the effect of conditional monetary rewards. Difficulty acts as a mediator of monetary rewards: conditional rewards are most effective at the intermediate or high levels of difficulty. I show that the inverse-U pattern of effort response to difficulty is not consistent with the Expected Utility model but is consistent with the Rank-Dependent Utility model that …
Loss Aversion And The Quantity-Quality Tradeoff, Jared Rubin, Anya Samek, Roman M. Sheremeta
Loss Aversion And The Quantity-Quality Tradeoff, Jared Rubin, Anya Samek, Roman M. Sheremeta
ESI Working Papers
Firms face an optimization problem that requires a maximal quantity output given a quality constraint. But how do firms incentivize quantity and quality to meet these dual goals, and what role do behavioral factors, such as loss aversion, play in the tradeoffs workers face? We address these questions with a theoretical model and an experiment in which participants are paid for both quantity and quality of a real effort task. Consistent with basic economic theory, higher quality incentives encourage participants to shift their attention from quantity to quality. However, we also find that loss averse participants shift their attention from …
A Reexamination Of “The Hidden Return To Incentives”, Jing Davis, Steven Schwartz, Richard Young
A Reexamination Of “The Hidden Return To Incentives”, Jing Davis, Steven Schwartz, Richard Young
Economics Faculty Articles and Research
Prior literature has observed a “hidden return to incentives” where principals receive more cooperation from agents when formal incentives are available but not used than when not available. Previous experiments are replicated using a gift-exchange rather than a trust game. Hidden returns to incentives are not observed, and in fact the results show the opposite. Suggestions for future research are provided.
A Study Of The Triggers Of Conflict And Emotional Reactions, Michael Caldera, Michael T. Mcbride, Matthew W. Mccarter, Roman M. Sheremeta
A Study Of The Triggers Of Conflict And Emotional Reactions, Michael Caldera, Michael T. Mcbride, Matthew W. Mccarter, Roman M. Sheremeta
ESI Publications
We study three triggers of conflict and explore their resultant emotional reactions in a laboratory experiment. Economists suggest that the primary trigger of conflict is monetary incentives. Social psychologists suggest that conflicts are often triggered by fear. Finally, evolutionary biologists suggest that a third trigger is uncertainty about an opponent’s desire to cause harm. Consistent with the predictions from economics, social psychology, and evolutionary biology, we find that conflict originates from all three triggers. The three triggers differently impact the frequency of conflict, but not the intensity. Also, we find that the frequency and intensity of conflict decrease positive emotions …
Firing Threats: Incentive Effects And Impression Management, Brice Corgnet, Roberto Hérnan-Gonzalez, Stephen J. Rassenti
Firing Threats: Incentive Effects And Impression Management, Brice Corgnet, Roberto Hérnan-Gonzalez, Stephen J. Rassenti
Economics Faculty Articles and Research
We study the effect of firing threats in a virtual workplace that reproduces features of existing organizations. We show that organizations in which bosses can fire up to one third of their workforce produce twice as much as organizations for which firing is not possible. Firing threats sharply decrease on-the-job leisure. Nevertheless, organizations endowed with firing threats underperformed those using individual incentives. In the presence of firing threats, employees engage in impression management activities to be seen as hard-working individuals in line with our model. Finally, production levels dropped substantially when the threat of being fired was removed, whereas on-the-job …
Firing Threats And Tenure In Virtual Organizations: Incentives Effects And Impression Management, Brice Corgnet, Roberto Hernán González, Stephen Rassenti
Firing Threats And Tenure In Virtual Organizations: Incentives Effects And Impression Management, Brice Corgnet, Roberto Hernán González, Stephen Rassenti
ESI Publications
We study the effect of firing threats in a virtual workplace that reproduces features of existing organizations. We show that organizations in which bosses can fire up to one third of their workforce produce twice as much as organizations for which firing is not possible. Firing threats sharply decrease on-the-job leisure. Nevertheless, organizations endowed with firing threats underperformed those using individual incentives. In the presence of firing threats, employees engage in impression management activities to be seen as hard-working individuals in line with our model. Finally, production levels dropped substantially when the threat of being fired was removed, whereas on-the-job …
Peer Pressure And Moral Hazard In Teams: Experimental Evidence, Brice Corgnet, Roberto Hernán-González, Stephen Rassenti
Peer Pressure And Moral Hazard In Teams: Experimental Evidence, Brice Corgnet, Roberto Hernán-González, Stephen Rassenti
ESI Publications
Team incentives have been found to be particularly effective both in the lab and in the field despite the moral hazard in teams problem identified by Holmström (1982). In a newly developed virtual workplace, we show that, in line with Holmström, moral hazard in teams is indeed pervasive. Subsequently, we find strong evidence for the conjecture of Kandel and Lazear (1992) that peer pressure may resolve the moral hazard in teams problem. Organizations equipped with a very weak form of peer monitoring (anonymous and without physical proximity, verbal threats or face-to-face interactions) perform as well as those using individual incentives.