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Incentives for creativity

Author

Listed:
  • Sanjiv Erat

    (University of California)

  • Uri Gneezy

    (University of California
    University of Amsterdam)

Abstract

We investigate whether piece-rate and competitive incentives affect creativity, and if so, how the incentive effect depends on the form of the incentives. We find that while both piece-rate and competitive incentives lead to greater effort relative to a base-line with no incentives, neither type of incentives improve creativity relative to the base-line. More interestingly, we find that competitive incentives are in fact counter-productive in that they reduce creativity relative to base-line condition. In line with previous literature, we find that competitive conditions affect men and women differently: whereas women perform worse under competition than the base-line condition, men do not.

Suggested Citation

  • Sanjiv Erat & Uri Gneezy, 2016. "Incentives for creativity," Experimental Economics, Springer;Economic Science Association, vol. 19(2), pages 269-280, June.
    • Handle: RePEc:kap:expeco:v:19:y:2016:i:2:d:10.1007_s10683-015-9440-5
    DOI: 10.1007/s10683-015-9440-5
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    References listed on IDEAS

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    1. Lazear, Edward P & Rosen, Sherwin, 1981. "Rank-Order Tournaments as Optimum Labor Contracts," Journal of Political Economy, University of Chicago Press, vol. 89(5), pages 841-864, October.
    2. Uri Gneezy & Aldo Rustichini, 2000. "Pay Enough or Don't Pay at All," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 115(3), pages 791-810.
    3. Hans K. Hvide, 2002. "Tournament Rewards and Risk Taking," Journal of Labor Economics, University of Chicago Press, vol. 20(4), pages 877-898, October.
    4. Uri Gneezy & Muriel Niederle & Aldo Rustichini, 2003. "Performance in Competitive Environments: Gender Differences," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 118(3), pages 1049-1074.
    5. Bruno S. Frey & Reto Jegen, 2001. "Motivation Crowding Theory," Journal of Economic Surveys, Wiley Blackwell, vol. 15(5), pages 589-611, December.
    6. Dan Ariely & Uri Gneezy & George Loewenstein & Nina Mazar, 2009. "Large Stakes and Big Mistakes," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 76(2), pages 451-469.
    7. Rachel Croson & Uri Gneezy, 2009. "Gender Differences in Preferences," Journal of Economic Literature, American Economic Association, vol. 47(2), pages 448-474, June.
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