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Using a natural field experiment to test the theory of multitasking

  • Fuhai Hong
  • John List
  • Migiwa Tanaka
  • Tanjim Hossain

A well-recognized problem in the multitasking literature is that workers might substantially reduce their effort on tasks that produce unobservable outputs as they seek the salient rewards to observable outputs. Since the theory related to multitasking is decades ahead of the empirical evidence, the economic costs of standard incentive schemes under multitasking contexts remain largely unknown. This study provides empirical insights quantifying such effects using a field experiment in Chinese factories. Using more than 2200 data points across 126 workers, we find sharp evidence that workers do trade off the incented output (quantity) at the expense of the non-incented one (quality) as a result of a piece rate bonus scheme. Consistent with our theoretical model, treatment effects are much stronger for workers whose base salary structure is a flat wage compared to those under a piece rate base salary. While the incentives result in a large increase in quantity and a sharp decrease in quality for workers under a flat base salary, they result only in a small increase in quantity without affecting quality for workers under a piece rate base salary.

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Paper provided by The Field Experiments Website in its series Natural Field Experiments with number 00388.

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Date of creation: 2013
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Handle: RePEc:feb:natura:00388
Contact details of provider: Web page: http://www.fieldexperiments.com

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  2. Dumont, Etienne & Fortin, Bernard & Jacquemet, Nicolas & Shearer, Bruce S., 2007. "Physicians' Multitasking and Incentives: Empirical Evidence from a Natural Experiment," IZA Discussion Papers 3229, Institute for the Study of Labor (IZA).
  3. Tanjim Hossain & John A. List, 2009. "The Behavioralist Visits the Factory: Increasing Productivity Using Simple Framing Manipulations," NBER Working Papers 15623, National Bureau of Economic Research, Inc.
  4. Imran Rasul & Iwan Barankay & Orana Bandiera, 2005. "Social preferences and the response to incentives: Evidence from personnel data," Natural Field Experiments 00212, The Field Experiments Website.
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  9. Paarsch, Harry J & Shearer, Bruce, 2000. "Piece Rates, Fixed Wages, and Incentive Effects: Statistical Evidence from Payroll Records," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 41(1), pages 59-92, February.
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  15. Steven D. Levitt & John A. List, 2009. "Was there Really a Hawthorne Effect at the Hawthorne Plant? An Analysis of the Original Illumination Experiments," NBER Working Papers 15016, National Bureau of Economic Research, Inc.
  16. Bruce Shearer, 2004. "Piece Rates, Fixed Wages and Incentives: Evidence from a Field Experiment," Review of Economic Studies, Oxford University Press, vol. 71(2), pages 513-534.
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  18. Slade, Margaret E, 1996. "Multitask Agency and Contract Choice: An Empirical Exploration," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 37(2), pages 465-86, May.
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