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Feedback and Incentives : Experimental Evidence Author info | Abstract | Publisher info | Download info | Related research | Statistics Tor Eriksson () (Aarhus School of Business, Aarhus University, Department of Economics and Center for Corporate Performance)
Anders Poulsen () (School of Economics, University of East Anglia)
Marie-Claire Villeval () (GATE, University of Lyon, CNRS, ENS-LSH, Centre Léon Bérard, France)
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This paper experimentally investigates the impact of different pay and relative performance information policies on employee effort. We explore three information policies: No feedback about relative performance, feedback given halfway through the production period, and continuously updated feedback. The pay schemes are a piece rate payment scheme and a winner-takes-all tournament. We find that, regardless of the pay scheme used, feedback does not improve performance. There are no significant peer effects in the piece-rate pay scheme. In contrast, in the tournament scheme we find some evidence of positive peer effects since the underdogs almost never quit the competition even when lagging significantly behind, and frontrunners do not slack off. Moreover, in both pay schemes information feedback reduces the quality of the low performers’ work.
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Paper provided by Groupe d'Analyse et de Théorie Economique (GATE), Centre national de la recherche scientifique (CNRS), Université Lyon 2, Ecole Normale Supérieure in its series Working Papers with number
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Length: 42 pages
Date of creation: 2008Date of revision:
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Keywords: evaluation feedback information laboratory experiments peer effects performance pay piece rate tournament Other versions of this item:
Paper Eriksson, Tor & Poulsen, Anders & Villeval, Marie-Claire, 2008.
"Feedback and Incentives: Experimental Evidence ,"
IZA Discussion Papers
3440, Institute for the Study of Labor (IZA).
[Downloadable!] Tor Eriksson & Anders Poulsen & Marie-Claire Villeval, 2008.
"Feedback and Incentives : Experimental Evidence ,"
Post-Print
halshs-00276396_v1, HAL.
[Downloadable!] Eriksson, Tor & Villeval, Marie-Claire, 2004.
"Other-Regarding Preferences and Performance Pay – An Experiment on Incentives and Sorting ,"
IZA Discussion Papers
1191, Institute for the Study of Labor (IZA).
[Downloadable!] Tor Eriksson & Marie-Claire Villeval, 2004.
"Other-Regarding Preferences and Performance Pay - An Experiment on Incentives and Sorting ,"
Post-Print
halshs-00180115_v1, HAL.
[Downloadable!] Tor Eriksson & Marie-Claire Villeval, 2004.
"Other-Regarding Preferences and Performance Pay – An Experiment on Incentives and Sorting ,"
Post-Print
halshs-00175006_v1, HAL.
[Downloadable!] Marie-Claire Villeval & Tor Eriksson, 2004.
"Other-Regarding Preferences and Performance Pay – An Experiment on Incentives and Sorting ,"
Working Papers
0408, Groupe d'Analyse et de Théorie Economique (GATE), Centre national de la recherche scientifique (CNRS), Université Lyon 2, Ecole Normale Supérieure.
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