The Effect of Payment Medium on Effort

Elif Incekara-Hafalir () and Raymond Kumar ()
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Elif Incekara-Hafalir: University of Technology Sydney
Raymond Kumar: Allianz, Australia

No 2019/13, Working Paper Series from Economics Discipline Group, UTS Business School, University of Technology, Sydney

Abstract: There are a number of payment mediums that are used to pay participants in Economics lab experiments, with cash payments being common practice. However, institutional barriers or funding constraints may prevent researchers using this conventional payment medium. Alternative payment mediums may have different psychological effects on participants, and thereby change the behaviour in the lab. In this paper, we investigate the effect of using different payment mediums on participants. We find that different payment mediums affect participants� effort when a fixed payment scheme is used but does not influence effort when a performance-based scheme is used.

Keywords: payment medium; monetary incentives; social norms; market norms (search for similar items in EconPapers)
Pages: 30 pages
Date: 2019-09-01
New Economics Papers: this item is included in nep-cbe, nep-exp and nep-pay
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