The Role of Information in Performance Schemes: Evidence from a Field Experiment

Résumé

Incentive schemes affect performance and priorities of agents but, in reality, they can be complicated even for simple tasks. We analyze the effects of the salience of incentives in a multi-tasking team production setting. We use data from a controlled field experiment that changed the communication of the incentive system without changing the actual incentives. The results indicate that the salience of a given incentive scheme is qualitatively and quantitatively important for performance. We find that higher salience of incentives for quantity increases quantity, (slightly) reduces quality, and substantially increases in-pocket income of team managers.

Codes JEL