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Letting Down the Team? Social Effects of Team Incentives

Philip Babcock, Kelly Bedard (), Gary Charness (), John Hartman and Heather Royer ()

University of California at Santa Barbara, Economics Working Paper Series from Department of Economics, UC Santa Barbara

Abstract: This paper estimates social effects of incentivizing people in teams. In two fieldexperiments featuring exogenous team formation and opportunities for repeated socialinteractions, we find large team effects that operate through social channels. The teamcompensation system induced agents to choose effort as if they valued a marginal dollar ofcompensation for their teammate from two-thirds as much (in one study) to twice as much asthey valued a dollar of their own compensation (in the other study). We conclude that socialeffects of monetary team incentives exist and can induce effort at lower cost than through directindividual payment.

Keywords: Social and Behavioral Sciences; field experiment; team incentives; social effects (search for similar items in EconPapers)
Date: 2012-08-10
New Economics Papers: this item is included in nep-evo, nep-exp, nep-hrm and nep-soc
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Journal Article: LETTING DOWN THE TEAM? SOCIAL EFFECTS OF TEAM INCENTIVES (2015) Downloads
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