From personal to personalized goals: How goal nudges improve production

We study how workers’ non-binding self-set goals affect their production and whether goal nudges (ability-calibrated goal hints) make goal setting more effective. In a real-effort task, participants first complete an ability pretest and are then assigned to one of three treatments: a no-goal baseline, a personal goal treatment with no external hint, or a personalized goal nudge that participants may accept or modify. We document a positive link between goals and production. However, merely asking workers to set goals is ineffective: when left unguided, workers anchor on conservative goals well below those induced by goal nudges, leading to underperformance. In contrast, goal nudges increase production and substantially reduce on-the-job leisure, hence inducing higher effort and engagement. These gains are concentrated in early periods, when workers are most uncertain about their own ability, and attenuate as they accumulate task experience. We develop a theory in which this effect operates through self-efficacy. Goal nudges act as informative signals that increase workers’ beliefs about their likelihood of success, thereby raising self-set goals and, in turn, increasing effort. Our findings suggest that personalized goal nudges offer organizations a low-cost complement to monetary incentives, particularly valuable for workers who are new to a task or role.