Using Milestones as a Source of Feedback in Teamwork: Insights from a Dynamic Voluntary Contribution Mechanism

Nisvan Erkal, Boon Han Koh and Nguyen Lam
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Nguyen Lam: Department of Economics, University of Melbourne

No 2310, Discussion Papers from University of Exeter, Department of Economics

Abstract: Many economic activities rely on teamwork where groups of individuals work together for a common goal by pooling their resources or skills. However, cooperation within teams can be challenging due to the social dilemma problem which arises when individual incentives interfere with operational effectiveness. We study teamwork in a dynamic public goods game setting where individuals make multiple contribution decisions to a team project and face strategic uncertainty about the behavior of their team members. We examine whether providing feedback about the team’s progress at regular intervals (time-based feedback) or based on the achievement of milestones (milestone-based feedback) is more beneficial for increasing aggregate contributions. Our results reveal that providing milestone-based feedback leads to a significant increase in aggregate team contributions as compared to time-based feedback. This impact is largely driven by conditional cooperators. Findings from a follow-up experiment reveal evidence of a goal effect, a signaling effect, and an information effect arising from the use of milestones on the behavior of conditional cooperators.

Keywords: teamwork; public good provision; milestones; feedback; voluntary contribution mechanism (search for similar items in EconPapers)
JEL-codes: C92 D83 D91 H41 (search for similar items in EconPapers)
Date: 2023-09-12
New Economics Papers: this item is included in nep-cbe, nep-cdm, nep-exp, nep-gth and nep-hrm
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