The essential economics of threshold-based incentives: Theory, estimation, and evidence from the Western States 100

Darren Grant ()

Journal of Economic Behavior & Organization, 2016, vol. 130, issue C, 180-197

Abstract: Many public and private entities utilize incentive systems in which improvements in measured performance are rewarded only when the agent crosses some pre-specified threshold. This paper comprehensively analyzes the effects of these incentive systems on effort, the net benefits of effort, and the accuracy of information about agents’ performance, and lays out methods for estimating each. These methods are then used to reveal the motivations, physiological limits, and racing strategy of ultramarathoners trying to complete a one hundred mile race in under twenty-four hours.

Keywords: Thresholds; Behavioral incentives; Ultramarathons (search for similar items in EconPapers)
JEL-codes: C14 D10 L83 (search for similar items in EconPapers)
Date: 2016
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Citations: View citations in EconPapers (5)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jeborg:v:130:y:2016:i:c:p:180-197

DOI: 10.1016/j.jebo.2016.07.013

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