Respect and relational contracts

Assuming that people care not only about what others do but also on what others think, we study respect in a labor market context where the length of the employment relationship is endogenous. In our three-stage gift-exchange experiment, the employer can express respect by giving the employee costly symbolic rewards after observing his level of effort. We study whether symbolic rewards are used by the employers mainly to praise employees or as a coordination device to build relational contracts by manipulating the balance between labor demand and supply in the market. We find that a high proportion of long-term relationships have been initiated by the assignment of symbolic rewards. However, the assignment of symbolic rewards decreases when it becomes clear that the relationship is durable, suggesting that employers mainly use symbolic rewards as a coordination device to initiate relational contracts. Compared to the balanced market condition, assigning symbolic rewards in initial relationships is less likely when there is excess demand in the market and more likely when there is excess supply, i.e., when the relationship is more valuable. Receiving symbolic rewards increases the employees’ likelihood of accepting to continue the relationship with the same employer. It also motivates them to increase their effort further but only when the market is balanced. Overall, the ability to assign symbolic rewards does not give rise to higher profits because it is associated with lower rents offered to the employees on average, leading to lower effort levels.     

物质奖励对知识共享的作用研究：争论与整合

物质奖励对知识共享是促进作用还是抑制作用,学术界一直存在争议。厘清物质奖励对知识共享的影响和作用机制,有助于理解现有研究关于物质奖励对知识共享影响的争论,推动该理论进一步发展。以现有文献为基础,理清了物质奖励与知识共享之间的争议关系,构建了物质奖励对知识共享的作用机制框架,从整合视角进一步分析了争论产生的原因。最后,针对现有研究不足,提出未来可以通过划分知识类型、细化物质奖励及奖励对象,引入新视角、引入新的调节及中介机制等进行深入研究。通过构建物质奖励对知识共享的作用机制框架,不仅有利于加深对物质奖励影响知识共享过程的理解,推动该理论进一步发展,也能更好地指导企业运用物质奖励对员工知识进行管理。     

On the (in)effectiveness of rewards in sustaining cooperation

We study the effectiveness of costly rewards in mitigating excess extraction in a standard Common Pool Resource (CPR) game experiment. We implement two treatments. In the first, rewards are a pure transfer from one player to the other. In the second, the benefits of receiving a reward are higher than the cost of providing it. Referring to the latter as “net positive” rewards, we observe that these are used more frequently than transfer rewards, and that, unlike transfer rewards, they are effective in sustaining cooperation in the CPR game. JEL Classification C72, C92, D74     

Identification of Dynamic Models of Rewards Programme

“Frequent‐buyer” rewards programmes are commonly used by companies as a marketing tool to compete for market share. They provide a unique environment for studying consumers’ forward‐looking behaviour. The consumer's problem on accumulating reward points can be formulated as a stationary infinite horizon discrete choice dynamic programming model. We show that the parameters of this model, including the discount factor, are well‐identified. In particular, it is possible to identify state‐dependent discount factors (i.e. discount factors can vary with the number of reward points). We discuss how this identification result is related to the goal‐gradient hypothesis studied in the consumer psychology literature.     

不同激励偏好下创新奖励对研发人员创新行为的影响 ——自我决定与特质激活理论整合视角

基于自我决定理论与特质激活理论整合观点,构建以激励偏好为调节变量、创新自我效能感为中介变量的研究框架,探讨创新奖励对创新行为的影响机制及边界条件。研究表明：创新奖励对创新行为有显著正向影响,创新自我效能感部分中介创新奖励对创新行为的影响;在创新奖励强情境中,内激励偏好、外激励偏好分别正向调节创新奖励对创新自我效能感的影响,且正向调节创新奖励通过创新自我效能感影响创新行为的中介作用。研究揭示了当研发人员普遍认为创新工作内在激励不足时,在不同激励偏好下创新奖励是如何影响创新行为的,并有助于完善创新奖励制度以促进研发人员创新行为。     

Rewards and Sanctions and the Provision of Public Goods in One-Shot Settings

A burgeoning literature in experimental studies of the Voluntary Contribution Mechanism focuses on the ability of institutions that allow the monitoring, sanctioning, and/or rewarding of others to facilitate cooperation. In this paper rewards and sanctions are examined in a one-shot VCM setting that so far has been unexplored in the literature. The study finds that while some subjects are willing to reward and sanction others at a personal cost, the opportunity to reward or sanction is ineffective in facilitating cooperation relative to previous experiments in which a repeated game environment is employed. The study also compares behavior in an environment in which the imposition of rewards and sanctions is certain to an environment in which imposition is uncertain. The expected value of the reward or sanction is kept constant across environments to focus simply on the effect of uncertainty about imposition. Uncertainty does not change behavior in a significant way, either in the level of cooperation or the willingness of individuals to impose rewards or sanctions.     

创造力绩效激励对产品创新中员工创造力的影响

考察了产品创新情境下,创造力绩效激励对创新小组成员渐进性和突破性创造力的作用机制,并检验了绩效反馈和部门异质性的调节作用和知识共享的中介作用。结果表明,创造力绩效激励对渐进性创造力具有促进作用;绩效反馈和部门异质性均正向调节创造力绩效激励对渐进性创造力的影响;同时,绩效反馈的调节效应部分通过知识共享中介,部门异质性的调节效应完全通过知识共享中介;创造力绩效激励对突破性创造力具有抑制作用。     

Group rewards and individual sanctions in environmental policy

We examine an incentive scheme for a group of agents, where all agents are rewarded if the group meets its target. If the group does not meet its target, only the agents that meet their individual target are rewarded. This incentive scheme is applied in the UK Climate Change Agreements. There is only a difference in outcome between group and individual rewards if performance is stochastic. Group rewards lead to lower abatement than individual rewards if targets are realistic, i.e. if they have a high probability of being reached. Given the strictness of the targets, the agents prefer group rewards. The principal might want to use group rewards because they require less information, out of fairness concerns, or to combine strict targets with weak enforcement.     

Social approval,competition and cooperation

Non-monetary rewards are frequently used to promote pro-social behaviors, and these behaviors often result in approval from one’s peers. Nevertheless, we know little about how peer-approval, and particularly competition for peer-approval, influences people’s decisions to cooperate. This paper provides experimental evidence suggesting that people in peer-approval competitions value social approval more when it leads to unique and durable rewards. Our evidence suggests that such rewards act as a signaling mechanism, thereby contributing to the value of approval. We show that this signaling mechanism generates cooperation at least as effectively as cash rewards. Our findings point to the potential value of developing new mechanisms that rely on small non-monetary rewards to promote generosity in groups.     

Gender differences in productivity rewards: the role of human capital

In this paper, we evaluate the gender wage gap component due to differences in characteristics’ rewards in Italy. The main focus is on the relationship between human capital characteristics and gender differences in rewards. We propose a methodology that combines the quantile regression analysis with non-parametric procedures for the estimation of the probability density functions of reward differentials in order to evaluate the evolution of the gap due to human capital characteristics. The analysis is carried out on Italian data taken from the latest available cross-section of the European Community Household Panel (2001). Our study suggests that education can be a good productivity signal and helps reduce the range of the gap; furthermore, highly educated women experience lesser gender-based pay differences as the length of the employment relationship increases.     

Discretionary rewards as a feedback mechanism

This paper studies the use of discretionary rewards in a finitely repeated principal–agent relationship with moral hazard. The key aspect is that rewards have informational content. When the principal obtains a private subjective signal about the agent's performance, she may pay discretionary bonuses to provide credible feedback to the agent. In accordance with the often observed compression of ratings, we show that in equilibrium the principal communicates the agent's interim performance imperfectly, i.e., she does not fully differentiate good and bad performance. Furthermore, we show that small rewards can have a large impact on the agent's effort, provided that the principal's stake in the project is small.     

Active ageing beyond the labour market: evidence on the role of intrinsic and extrinsic rewards at work

‘Active Ageing’ strategies aim to foster the participation of seniors in the society. Although economic literature has extensively studied the incentives for seniors to increase their labour supply, little is known about the motivations for older people to complement labour with other forms of social participation. This article provides empirical evidence of the role of intrinsic and extrinsic rewards received at work in the supply of formal and informal productive activities of 50- to 65-year-old workers. The results show that workers with higher levels of intrinsic rewards received at work, such as skill development opportunities and decision latitude, are more likely to participate in social activities outside the labour market. Extrinsic rewards on the other hand, like advancement perspectives, job security and pay, appear independent from both formal and informal social participation.     

Discretionary rewards as a feedback mechanism

This paper studies the use of discretionary rewards in a finitely repeated principal–agent relationship with moral hazard. The key aspect is that rewards have informational content. When the principal obtains a private subjective signal about the agent's performance, she may pay discretionary bonuses to provide credible feedback to the agent. In accordance with the often observed compression of ratings, we show that in equilibrium the principal communicates the agent's interim performance imperfectly, i.e., she does not fully differentiate good and bad performance. Furthermore, we show that small rewards can have a large impact on the agent's effort, provided that the principal's stake in the project is small.     

Managerial risks and rewards in public enterprises

This essay explores a twofold problem: from the standpoint of the community, what is the appropriate attitude for managers of a public enterprise to have toward decisions with uncertain outcomes; and what is implied for the managerial rewards or penalties that are required to induce managers to adopt that attitude. Taking a theorem of Arrow's as a point of departure, the essay argues that managers should be induced to maximize expected benefit. With the aid of “career” and “bonus” functions, implications for managerial rewards and penalties are explored under     

DO MONETARY REWARDS CROWD OUT THE INTRINSIC MOTIVATION OF VOLUNTEERS? SOME EMPIRICAL EVIDENCE FOR ITALIAN VOLUNTEERS

ABSTRACT 1 : The paper studies the determinants of regular volunteering, taking its cue from the previous literature on extrinsic and intrinsic motivations. Its main contribution lies in the analysis of the role of monetary rewards in influencing intrinsic motivation. It uses frameworks that allow empirical hypotheses to be made about the effects of monetary rewards, intrinsic motivation and the combined term on volunteer labour supply. With an Italy‐based survey, the paper shows, controlling for endogenous bias, that monetary payments as well as intrinsic motivation have roles in the real‐life decision to supply volunteer work, but monetary rewards do not crowd out intrinsic motivation.     

Delegating decision rights for anticipated rewards as an alternative to corruption: An experiment

We study experimentally whether anti-corruption policies with a focus on bribery might be insufficient to uncover more subtle ways of gaining an unfair advantage. In particular, we investigate whether an implicit agreement to exchange favors between a decision-maker and a lobbying party serves as a legal substitute for corruption. We find that even the pure anticipation of future rewards from a lobbying party suffices to bias a decision-maker in favor of this party, even though it creates negative externalities to others. Although future rewards are not contractible, the benefitting party voluntarily compensates decision-makers for partisan choices. In this way, both earn more at the expense of others. Thus, the outcome mirrors what might have been achieved via conventional bribing, while not being illegal.     

The impact of incentives on the intention to try a new technology

Persuading users to try new technologies continues to be a problem confronting organisations and technology vendors alike. To better understand the process of new technology trial and adoption, several theoretical models have been proposed, of which the Technology Acceptance Model has gained significant support. However, research concerning tangible extrinsic rewards has not been explored. The primary goal of this research is to study the impact of tangible extrinsic rewards on various aspects of an intention to engage in an initial trial of a new technology. The theoretical model was tested on 284 students as subjects in a trial of a new technology. Results suggest that such incentives may be effective in increasing the behavioural intention to try a new technology. Results also identify that when incentives are provided, perceived ease of use and usefulness are the primary drivers towards intentions to try a new technology.     

“Little Science” and “Big Science”: The institution of “Open Science” as a cause of scientific and economic inequalities among countries

In this paper we analyse how the science sector's incentive structure strongly contributes to the development of science and of the economy, even if, in the same time, it can cause large disparities in size and productivity of scientific sectors of different countries. In order to show that, we adopt a Schumpeterian growth model where the resources allocated to science are endogenously determined within the economy and science is organised according to the institution of “Open Science”. This latter consists in a self-reinforcing code of conduct, which comprises an incentive scheme based on the priority rule, and on the presence of both real rewards and social rewards. Social rewards take two main forms according to the source concerned: one is the social reward deriving from major innovations; another consists in high reputation enjoyed by researchers who put a high level of effort into their job, and devote themselves to the advancement of science. This set of rules causes the emergence of two locally stable steady-states: a low equilibrium, where the economy is endowed with a small science sector; and a high equilibrium, where the economy has a large science sector with rapid knowledge advancement. The two equilibria can account for the huge differences currently existing between scientific sectors of more developed and less developed countries. Comparative static results further characterise the two equilibria, since monetary and social rewards have different effects according to the type of equilibrium that emerges.     

Rewards and the private provision of public goods on dynamic networks

We study an evolutionary model of a public good game with rewards played on a network. Giving rewards to contributors transforms the game but gives rise to a second-order dilemma. By allowing for coevolution of strategies and network structure, the evolutionary dynamics operate on both structure and strategy. Players learn with whom to interact and how to act and can overcome the second-order dilemma. More specifically, the network represents social distance which changes as players interact. Through the change in social distance, players learn with whom to interact, which we model using reinforcement dynamics. We find that, for certain parameter constellations, a social institution, prescribing prosocial behavior and thus solving the second-order dilemma, can emerge from a population of selfish players. Due to the dynamic structure of the network, the institution has an endogenous punishment mechanism ensuring that defectors will be excluded from the benefits of the institution and the public good will be supplied efficiently.