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

Author

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  • 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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    Citations

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    Cited by:

    1. Thomas Walter & Christoph Ihl & René Mauer & Malte Brettel, 2018. "Grace, gold, or glory? Exploring incentives for invention disclosure in the university context," The Journal of Technology Transfer, Springer, vol. 43(6), pages 1725-1759, December.
    2. Hammermann, Andrea & Mohnen, Alwine, 2014. "The pric(z)e of hard work," Journal of Economic Psychology, Elsevier, vol. 43(C), pages 1-15.
    3. Bruno S. Frey & Susanne Neckermann, 2010. "Awards as Signals," CESifo Working Paper Series 3229, CESifo.
    4. 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.
    5. Gebhardt, Beate & Hellstern, Laura, 2023. "Die Kraft von Awards. Umfrage unter Unternehmen und Vergabeinstitutionen in Deutschland 2023," Working Papers 338798, Universitaet Hohenheim, Institute of Agricultural Policy and Agricultural Markets.
    6. Bruno S. Frey, 2010. "Geld oder Anerkennung? Zur Ökonomik der Auszeichnungen," Perspektiven der Wirtschaftspolitik, Verein für Socialpolitik, vol. 11(1), pages 1-15, February.
    7. 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).
    8. Eisenberg, Paul, 2016. "The Balanced Scorecard and Beyond – Applying Theories of Performance Measurement, Employment and Rewards in Management Accounting Education," MPRA Paper 74271, University Library of Munich, Germany, revised 05 Aug 2016.

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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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