Open AccessSmarter Task Assignment or Greater Effort: The Impact of Incentives on Team Performance *
Author(s) -
Burgess Simon,
Propper Carol,
Ratto Marisa,
Kessler Scholder Stephanie von Hinke,
Tominey Emma
Publication year - 2010
Publication title -
the economic journal
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 4.683
H-Index - 160
eISSN - 1468-0297
pISSN - 0013-0133
DOI - 10.1111/j.1468-0297.2009.02331.x
Subject(s) - incentive , schools of economic thought , media studies , history , political science , classics , sociology , economics , neoclassical economics , microeconomics
We use an experiment to study the impact of team‐based incentives, exploiting rich data from personnel records and management information systems. Using a triple difference design, we show that the incentive scheme had an impact on team performance, even with quite large teams. We examine whether this effect was due to increased effort from workers or strategic task reallocation. We find that the provision of financial incentives did raise individual performance but that managers also disproportionately reallocated efficient workers to the incentivised tasks. We show that this reallocation was the more important contributor to the overall outcome.