The Effects of Financial Incentives in Experiments: A Review and Capital-Labor-Production Framework

Colin F Camerer and Robin Hogarth ()

Journal of Risk and Uncertainty, 1999, vol. 19, issue 1-3, 7-42

Abstract: We review 74 experiments with no, low, or high performance-based financial incentives. The modal result is no effect on mean performance (though variance is usually reduced by higher payment). Higher incentive does improve performance often, typically judgment tasks that are responsive so better effort. Incentives also reduce "presentation" effects (e.g., generosity and risk-seeking). Incentive effects are comparable to effects of other variables, particularly "cognitive capital" and task "production" demands, and interact with those variables, so a narrow-minded focus on incentives alone is misguided. We also note that no replicated study has made rationality violations disappear purely by raising incentives. Copyright 1999 by Kluwer Academic Publishers

Date: 1999
References: Add references at CitEc
Citations: View citations in EconPapers (857)

Downloads: (external link)
http://journals.kluweronline.com/issn/0895-5646/contents link to full text (text/html)
Access to full text is restricted to subscribers.

Related works:
Working Paper: The Effects of Financial Incentives in Experiments: A Review and Capital-Labor-Production Framework (1999)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:kap:jrisku:v:19:y:1999:i:1-3:p:7-42

Ordering information: This journal article can be ordered from
http://www.springer. ... ry/journal/11166/PS2

Access Statistics for this article

Journal of Risk and Uncertainty is currently edited by W. Kip Viscusi

More articles in Journal of Risk and Uncertainty from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().