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Awards unbundled: evidence from a natural field experiment

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Listed:
  • Ashraf, Nava
  • Bandiera, Oriana
  • Lee, Scott S.

Abstract

Organizations often use non-monetary awards to incentivize performance. Awards may affect behavior through several mechanisms: by conferring employer recognition, by enhancing social visibility, and by facilitating social comparison. In a nationwide health worker training program in Zambia, we design a field experiment to unbundle these mechanisms. We find that employer recognition and social visibility increase performance while social comparison reduces it, especially for low-ability trainees. These effects appear when treatments are announced and persist through training. The findings are consistent with a model of optimal expectations in which low-ability individuals exert low effort in order to avoid information about their relative ability.

Suggested Citation

  • Ashraf, Nava & Bandiera, Oriana & Lee, Scott S., 2014. "Awards unbundled: evidence from a natural field experiment," LSE Research Online Documents on Economics 61125, London School of Economics and Political Science, LSE Library.
    • Handle: RePEc:ehl:lserod:61125
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    File URL: https://eprints.lse.ac.uk/61125/
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    More about this item

    Keywords

    awards; social comparison; optimal expectations; incentives;
    All these keywords.

    JEL classification:

    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
    • D84 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Expectations; Speculations
    • J33 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Compensation Packages; Payment Methods
    • M52 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Compensation and Compensation Methods and Their Effects
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration

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