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The dark side of team incentives: Experimental evidence on advice quality from financial service professionals

Author

Listed:
  • Anastasia Danilov

    (University of Cologne)

  • Torsten Biemann

    (University of Cologne)

  • Thorn Kring

    (Steinbeis University of Berlin)

  • Dirk Sliwka

    (University of Cologne)

Abstract

In an experiment with professionals from the financial services sector, we investigate the impact of a team incentive scheme on recommendation quality of investment products when advisors benefit from advising lower quality products. Experimental results reveal that, when group affiliation is strong, worse products are recommended significantly more often under team incentives than under individual incentives.

Suggested Citation

  • Anastasia Danilov & Torsten Biemann & Thorn Kring & Dirk Sliwka, 2012. "The dark side of team incentives: Experimental evidence on advice quality from financial service professionals," Cologne Graduate School Working Paper Series 03-13, Cologne Graduate School in Management, Economics and Social Sciences, revised 18 Dec 2012.
    • Handle: RePEc:cgr:cgsser:03-13
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    More about this item

    Keywords

    deception; team incentives; professionals; financial advice; experiment;
    All these keywords.

    JEL classification:

    • C90 - Mathematical and Quantitative Methods - - Design of Experiments - - - General
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General
    • M52 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Compensation and Compensation Methods and Their Effects

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