Do Monetary Incentives, Feedback and Recognition Matter for Performance? Evidence from a Field Experiment in a Retail Services Company

ABSTRACT This study investigates the performance effects of the combined use of three reinforcers, or incentive motivators, commonly used by companies: monetary incentives, feedback, and recognition. Using a field experiment in a retail services company, I test whether these incentives, which appeal to diverse motivation mechanisms—tangible payoffs, self-regulation, and social esteem—and, hence, have different utilities, are complements or substitutes. The results of the hard performance data collected, in the form of a ratio of sales relative to goals, show that monetary incentives and recognition are substitutes, while feedback is independent of the other incentives. The negative interaction between monetary incentives and recognition is evidence of crowding out between tangible payoffs and social esteem motivations. Individually, these two incentives have a positive impact on performance of about 13 percentage points, which corresponds to a 32.5 percent performance increase. Feedback interactions and main effects are not statistically significant, which suggests that, in this setting, providing feedback in the form of knowledge of results has no impact.

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Comparing monetary incentives for cycling: a field experiment

AEA Randomized Controlled Trials ◽

10.1257/rct.2462 ◽

2018 ◽

Author(s):

Alice Ciccone

Keyword(s):

Field Experiment ◽

Monetary Incentives

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Comparing monetary incentives for cycling: a field experiment

AEA Randomized Controlled Trials ◽

10.1257/rct.2462-1.0 ◽

2018 ◽

Author(s):

Alice Ciccone

Keyword(s):

Field Experiment ◽

Monetary Incentives

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Monetary incentives in recycling programs: a field experiment

AEA Randomized Controlled Trials ◽

10.1257/rct.6702-1.0 ◽

2020 ◽

Author(s):

Eduard Alonso-Pauli ◽

Iñigo Hernandez-Arenaz ◽

Lara Ezquerra ◽

Pau Balart

Keyword(s):

Field Experiment ◽

Monetary Incentives

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The Effects of Small Monetary Incentives on Response Quality and Rates in the Positive Confirmation of Account Receivable Balances (Retracted)

Auditing A Journal of Practice & Theory ◽

10.2308/aud.2001.20.1.157 ◽

2001 ◽

Vol 20 (1) ◽

pp. 157-168 ◽

Cited By ~ 3

Author(s):

Terry J. Engle ◽

James E. Hunton

Keyword(s):

Field Experiment ◽

Response Rates ◽

Potential Effect ◽

Monetary Incentives ◽

Effective Technique ◽

Response Quality ◽

Accounts Receivable ◽

Opinion Polling ◽

Full Factorial

The AICPA has indicated that the use of small monetary incentives might be an effective technique for improving confirmation response rates. A significant body of accounting and nonaccounting research supports the AICPA's position; however, studies in marketing and public opinion polling suggest that the quality of survey-based responses can either increase or decrease with the use of monetary incentives. Existing auditing research has not looked at the potential effect of monetary incentives on response quality in the context of confirming account receivable balances. This study was designed to investigate this important issue. In this field experiment, four large, independent newspaper organizations mailed a total of 7,200 trade accounts receivable confirmations. The experiment employed a three (no misstatement, understatement, and overstatement) by three (no incentive, quarter, and dollar) between-subjects, full-factorial design. Consistent with prior research, the use of monetary incentives improved response rates in all misstatement conditions and response quality was higher for overstated, when compared to understated, accounts. However, monetary incentives did not close the quality gap between overstated and understated accounts and, surprisingly, the use of incentives was associated with an overall decrease in response quality.

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Could Behavioural Nudges Improve the Accuracy of Waste Sorting? An Experimental Survey

Environment and Pollution ◽

10.5539/ep.v10n1p1 ◽

2021 ◽

Vol 10 (1) ◽

pp. 1

Author(s):

D. I. J. Samaranayake ◽

R. S. Thennakoon

Keyword(s):

Field Experiment ◽

Waste Disposal ◽

Negative Attitude ◽

Monetary Incentives ◽

Effective Strategy ◽

Color Sensitivity ◽

Three Stages ◽

The University ◽

The Impact ◽

Experimental Survey

The study consisted of a survey and field experiment to observe the impact of behavioural nudges on an individual’s attitudes and accuracy on waste sorting. The survey conducted on 203 students of the University of Peradeniya, and then the field experiment within the university premises. The responses to the survey revealed that the participants having a negative attitude toward the usual waste disposal and sorting practices. Also, the majority of the respondents preferred non-monetary incentives as an effective strategy to motivate individuals to improve the accuracy of waste sorting. Then the participants are given nine strategies as separate behavioural nudges to improve the waste sorting behavior. The responses are highly varied and the majority prefer to use a combination of different colours and detailed labels as a motivational strategy. Thus, the preferred strategy was examined at the faculty premises throughout three stages and tested three hypotheses. Findings revealed that the strategy improves the accuracy, and supports the university community for proper waste sorting practices. Further, it exposed that the detail labels and stickers are impactful than the color sensitivity of respondents.

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Like principal, like agent? Managerial preferences in employee-owned firms

Journal of Institutional Economics ◽

10.1017/s1744137421000783 ◽

2021 ◽

pp. 1-23

Author(s):

Guillermo Alves ◽

Pablo Blanchard ◽

Gabriel Burdin ◽

Mariana Chávez ◽

Andrés Dean

Keyword(s):

Optimal Design ◽

Field Experiment ◽

Time Preferences ◽

Monetary Incentives ◽

High Stakes ◽

Agent Interaction ◽

Economic Preferences ◽

Show Evidence ◽

Worker Cooperatives ◽

The Relationship

Abstract The relationship between firms’ owners and managers is a quintessential example of costly principal–agent interaction. Optimal design of monetary incentives and supervision mechanisms are the two traditional ways of reducing agency costs in this relationship. In this paper, we show evidence which is consistent with a third mechanism: firms have managers whose economic preferences are aligned with owners' interests. We uncover differences in economic preferences between managers employed in firms controlled by two distinct classes of ‘patrons’: employee-owned firms (worker cooperatives) and conventional investor-owned firms. In a high-stakes lab-in-the-field experiment, we find that co-op managers are less risk-loving and more altruistic than their conventional counterparts. We do not observe differences between the two groups in terms of time preferences, reciprocity, and trust. Our findings are consistent with existing evidence on worker cooperatives, such as their tendency to self-select into less risky industries and their compressed compensation structures.

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