http://clubtroppo.com.au/2008/11/13/temptation/ Sat, 20 Mar 2010 04:26:11 +0000 http://wordpress.org/?v=2.9.2 hourly 1 http://clubtroppo.com.au/2008/11/13/temptation/#comment-332626 Nicholas Gruen Thu, 20 Nov 2008 11:31:27 +0000 http://clubtroppo.com.au/?p=6382#comment-332626 It's not true that bonuses reduce performance <em>in general</em>. But they can if the job is intensive in intrinsic motivation and the bonuses crowd that out - as they often do. That's one reason I'm against performance bonuses for senior public servants. It is the case and it is healthy that it is the case that a good deal of their motivation is intrinsic. It’s not true that bonuses reduce performance in general. But they can if the job is intensive in intrinsic motivation and the bonuses crowd that out – as they often do. That’s one reason I’m against performance bonuses for senior public servants. It is the case and it is healthy that it is the case that a good deal of their motivation is intrinsic.

]]> http://clubtroppo.com.au/2008/11/13/temptation/#comment-332625 NPOV Thu, 20 Nov 2008 11:14:26 +0000 http://clubtroppo.com.au/?p=6382#comment-332625 Speaking of behavioural studies that have a link to economics, supposedy someone has determined that in certain cases, <a href="http://www.nytimes.com/2008/11/20/opinion/20ariely.html?ref=opinion" rel="nofollow">offers of bonus pay can actually reduce performance</a>. What would be interesting would be a study where bonuses were given without being promised beforehand, but were given out in a non-predictable fashion (i.e. in one round, it might be that only the best performer gets a large bonus, in the next, it might be that the top 3 each get a small bonus, in some rounds there may be no bonus at all). If it really is true in the general case that bonuses can reduce performance, it's hard to understand why bonuses are so widely used through various industries. Speaking of behavioural studies that have a link to economics, supposedy someone has determined that in certain cases, offers of bonus pay can actually reduce performance. What would be interesting would be a study where bonuses were given without being promised beforehand, but were given out in a non-predictable fashion (i.e. in one round, it might be that only the best performer gets a large bonus, in the next, it might be that the top 3 each get a small bonus, in some rounds there may be no bonus at all).
If it really is true in the general case that bonuses can reduce performance, it’s hard to understand why bonuses are so widely used through various industries.

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