Pay enough or don't pay at all

Uri Gneezy, Aldo Rustichini

Research output: Contribution to journalArticlepeer-review

1235 Scopus citations

Abstract

Economists usually assume that monetary incentives improve performance, and psychologists claim that the opposite may happen. We present and discuss a set of experiments designed to test these contrasting claims. We found that the effect of monetary compensation on performance was not monotonic. In the treatments in which money was offered, a larger amount yielded a higher performance. However, offering money did not always produce an improvement: subjects who were offered monetary incentives performed more poorly than those who were offered no compensation. Several possible interpretations of the results are discussed.

Original languageEnglish (US)
Pages (from-to)791-810
Number of pages20
JournalQuarterly Journal of Economics
Volume115
Issue number3
DOIs
StatePublished - Aug 2000

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