Together Everyone Achieves More (TEAM): Incentives for Productivity

What kind of incentives optimize a worker's motivation and performance, especially in remote work settings? We recruit online workers to work for up to 45 minutes on tedious tasks over three days. We randomly assign them to individualistic (Solo) or one of two team incentives. Under our Cooperative team incentive, workers equally share the team's earnings. Under our Competitive team incentive, the best performer gets an additional bonus proportional to the team's total productivity. We find that workers under the Cooperative team incentives are most likely to participate on all three days, exhaust all 45 minutes of work, and complete more tasks. Workers under Competitive team incentives also outperform the Solo workers, but the effect is insignificant. When workers can additionally observe their team member's effort from previous days (observability condition), they increase their own effort in response to their partner's high effort. This escalation effect is strongest under Competitive incentives, and under the observability condition, both team incentives outperform the individualistic incentive.