Cheating in the Workplace: An Experimental Study of the Impact of Bonuses and Productivity

David Gill, Victoria Prowse and Michael Vlassopoulos

No 6725, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: We use an online real-effort experiment to investigate how bonus-based pay and worker productivity interact with workplace cheating. Firms often use bonus-based compensation plans, such as group bonuses and firm-wide profit sharing, that induce considerable uncertainty in how much workers are paid. Exposing workers to a compensation scheme based on random bonuses makes them cheat more but has no effect on their productivity. We also find that more productive workers behave more dishonestly. We explain how these results suggest that workers' cheating behavior responds to the perceived fairness of their employer's compensation scheme.

Keywords: productivity; employee crime; lying; dishonesty; cheating; compensation; real effort; bonus; slider task; experiment (search for similar items in EconPapers)
JEL-codes: C91 J33 (search for similar items in EconPapers)
Pages: 23 pages
Date: 2012-07
New Economics Papers: this item is included in nep-cbe, nep-exp, nep-hrm and nep-lab
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (15)

Published - published in: Journal of Economic Behavior and Organization, 2013, 96, 120-134

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Journal Article: Cheating in the workplace: An experimental study of the impact of bonuses and productivity (2013)
Working Paper: Cheating in the workplace: An experimental study of the impact of bonuses and productivity (2013)
Working Paper: Cheating in the workplace: An experimental study of the impact of bonuses and productivity (2013)
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