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The Efficacy of Tournaments for Nonroutine Team Tasks

Author

Listed:
  • Florian Englmaier
  • Stefan Grimm
  • Dominik Grothe
  • David Schindler
  • Simeon Schudy

Abstract

Tournaments are often used to improve performance in innovation contexts. Tournaments provide monetary incentives but also render teams’ identity and image concerns salient. We study the effects of tournaments on team performance in a nonroutine task and identify the importance of these behavioral aspects. In a field experiment (n>1,700 participants), we vary the salience of team identity, social image concerns, and whether teams face monetary incentives. Increased salience of team identity does not improve performance. Social image motivates the top performers. Additional monetary incentives improve all teams’ outcomes without crowding out teams’ willingness to explore or perform similar tasks again.

Suggested Citation

  • Florian Englmaier & Stefan Grimm & Dominik Grothe & David Schindler & Simeon Schudy, 2024. "The Efficacy of Tournaments for Nonroutine Team Tasks," Journal of Labor Economics, University of Chicago Press, vol. 42(4), pages 921-948.
    • Handle: RePEc:ucp:jlabec:doi:10.1086/725553
    DOI: 10.1086/725553
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    Cited by:

    1. Florian Englmaier & Stefan Grimm & Dominik Grothe & David Schindler & Simeon Schudy, 2021. "The Value of Leadership: Evidence from a Large-Scale Field Experiment," CESifo Working Paper Series 9273, CESifo.
    2. Erik Sarrazin, 2026. "Incentives and Creativity in Groups — Experimental Evidence on Creative Processes and Dimensions," Working Papers 2601, Gutenberg School of Management and Economics, Johannes Gutenberg-Universität Mainz.
    3. Goette, Lorenz & Senn, Julien, 2024. "Incentivizing interdependent tasks: Evidence from a real-effort experiment," Journal of Economic Behavior & Organization, Elsevier, vol. 227(C).
    4. Timm Opitz, 2024. "Interpersonal Preferences and Team Performance: The Role of Liking in Complex Problem Solving," Rationality and Competition Discussion Paper Series 492, CRC TRR 190 Rationality and Competition.

    More about this item

    JEL classification:

    • C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments
    • D90 - Microeconomics - - Micro-Based Behavioral Economics - - - General
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J33 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Compensation Packages; Payment Methods
    • M52 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Compensation and Compensation Methods and Their Effects

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