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Do Professionals Choke Under Pressure?

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  • Dohmen, Thomas

    ()
    (University of Bonn)

Abstract

High rewards or the threat of severe punishment do not only provide incentives to exert high levels of effort but also create pressure. Such pressure can cause paradoxical performance effects, namely performance decrements despite strong incentives and high motivation. By analyzing the performance of professional football players on a well-defined task, namely to score on a penalty kick, the paper provides empirical evidence for the existence of such detrimental incentive effects. Two pressure variables are considered in particular: (1) the importance of success and (2) the presence of spectators. There are plenty of situations in which pressure arises in the workplace. Knowing how individuals perform under pressure conditions is crucial for labor economists because it has implications for the design of the workplace and the design of incentive schemes.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 1905.

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Length: 34 pages
Date of creation: Dec 2005
Date of revision:
Handle: RePEc:iza:izadps:dp1905

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Keywords: paradoxical performance effects of incentives; social pressure; choking under pressure;

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References

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  1. Canice Prendergast, 1999. "The Provision of Incentives in Firms," Journal of Economic Literature, American Economic Association, vol. 37(1), pages 7-63, March.
  2. Uri Gneezy & Aldo Rustichini, 2004. "Gender and Competition at a Young Age," American Economic Review, American Economic Association, vol. 94(2), pages 377-381, May.
  3. Edward P. Lazear, 1996. "Performance Pay and Productivity," NBER Working Papers 5672, National Bureau of Economic Research, Inc.
  4. Bernheim, B Douglas, 1994. "A Theory of Conformity," Journal of Political Economy, University of Chicago Press, vol. 102(5), pages 841-77, October.
  5. Spagnolo, Giancarlo, 1999. "Social relations and cooperation in organizations," Journal of Economic Behavior & Organization, Elsevier, vol. 38(1), pages 1-25, January.
  6. Ignacio Palacios-Huerta, 2003. "Professionals Play Minimax," Review of Economic Studies, Wiley Blackwell, vol. 70(2), pages 395-415, 04.
  7. Falk, Armin & Ichino, Andrea, 2003. "Clean Evidence on Peer Pressure," CEPR Discussion Papers 3834, C.E.P.R. Discussion Papers.
  8. Harry J. Paarsch & Bruce S. Shearer, 1999. "The Response of Worker Effort to Piece Rates: Evidence from the British Columbia Tree-Planting Industry," Journal of Human Resources, University of Wisconsin Press, vol. 34(4), pages 643-667.
  9. Akerlof, George A, 1980. "A Theory of Social Custom, of Which Unemployment May be One Consequence," The Quarterly Journal of Economics, MIT Press, vol. 94(4), pages 749-75, June.
  10. Gneezy, U. & Rustichini, A., 1998. "Pay Enough - Or Don't Pay at All," Discussion Paper 1998-57, Tilburg University, Center for Economic Research.
  11. Dan Ariely & Uri Gneezy & George Loewenstein & Nina Mazar, 2005. "Large stakes and big mistakes," Working Papers 05-11, Federal Reserve Bank of Boston.
  12. Kandel, Eugene & Lazear, Edward P, 1992. "Peer Pressure and Partnerships," Journal of Political Economy, University of Chicago Press, vol. 100(4), pages 801-17, August.
  13. Armin Falk & Andrea Ichino, 2004. "Clean Evidence on Peer Effects," Levine's Bibliography 666156000000000439, UCLA Department of Economics.
  14. Bruce Shearer, 2004. "Piece Rates, Fixed Wages and Incentives: Evidence from a Field Experiment," Review of Economic Studies, Wiley Blackwell, vol. 71(2), pages 513-534, 04.
  15. Dohmen, Thomas, 2005. "Social Pressure Influences Decisions of Individuals: Evidence from the Behavior of Football Referees," IZA Discussion Papers 1595, Institute for the Study of Labor (IZA).
  16. George A. Akerlof, 1997. "Social Distance and Social Decisions," Econometrica, Econometric Society, vol. 65(5), pages 1005-1028, September.
  17. P.-A. Chiappori, 2002. "Testing Mixed-Strategy Equilibria When Players Are Heterogeneous: The Case of Penalty Kicks in Soccer," American Economic Review, American Economic Association, vol. 92(4), pages 1138-1151, September.
  18. Frey, Bruno S & Jegen, Reto, 2001. " Motivation Crowding Theory," Journal of Economic Surveys, Wiley Blackwell, vol. 15(5), pages 589-611, December.
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Citations

Blog mentions

As found by EconAcademics.org, the blog aggregator for Economics research:
  1. How bonuses backfire
    by chris dillow in Stumbling and Mumbling on 2011-09-19 14:06:31
  2. Does fear work?
    by chris dillow in Stumbling and Mumbling on 2011-07-31 13:55:23
  3. Does Fear of Job Loss Work?
    by Mark Thoma in Economist's View on 2011-08-03 07:33:00
  4. Do Professionals Choke Under Pressure?
    by Ariel Goldring in Free Market Mojo on 2010-08-22 16:17:36
  5. The left & shareholder activism
    by chris dillow in Stumbling and Mumbling on 2012-05-08 13:51:01
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