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What is an Award Worth? An Econometric Assessment of the Impact of Awards on Employee Performance

Author

Listed:
  • Susanne Neckermann
  • Reto Cueni
  • Bruno S. Frey

Abstract

Behavioral economics documents the importance of status and self-image concerns in the workplace, but is largely silent about how to instrumentalize them to induce effort. Awards - widespread in the corporate sector and elsewhere - are motivators that derive their value from such social concerns. Panel data from the call center of a large international bank allow us to estimate the impact of receiving an award on effort. The performance of winners proves to be significantly higher than that of comparable non-recipients after the award has been presented. This increase in work effort is sizeable, robust, and not driven by reverse causation.

Suggested Citation

  • Susanne Neckermann & Reto Cueni & Bruno S. Frey, 2009. "What is an Award Worth? An Econometric Assessment of the Impact of Awards on Employee Performance," CESifo Working Paper Series 2657, CESifo.
  • Handle: RePEc:ces:ceswps:_2657
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    File URL: https://www.cesifo.org/DocDL/cesifo1_wp2657.pdf
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    Cited by:

    1. Bruno S. Frey & Susanne Neckermann, 2013. "Awards play an important role," Chapters, in: Francisco Cabrillo & Miguel A. Puchades-Navarro (ed.), Constitutional Economics and Public Institutions, chapter 17, pages 313-321, Edward Elgar Publishing.
    2. Bruno S. Frey & Susanne Neckermann, 2008. "Academics Appreciate Awards. A New Aspect of Incentives in Research," CREMA Working Paper Series 2008-32, Center for Research in Economics, Management and the Arts (CREMA).
    3. Bruno S. Frey & Susanne Neckermann, 2010. "Awards As Signals," CREMA Working Paper Series 2010-21, Center for Research in Economics, Management and the Arts (CREMA).
    4. Bruno S. Frey, 2010. "Geld oder Anerkennung? Zur Ökonomik der Auszeichnungen," Perspektiven der Wirtschaftspolitik, Verein für Socialpolitik, vol. 11(1), pages 1-15, February.

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    More about this item

    Keywords

    awards; motivation; non-monetary compensation; event-study; incentives;
    All these keywords.

    JEL classification:

    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • 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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