Discussion of Pressure and Performance in Accounting Decision Settings: Paradoxical Effects of Incentives, Feedback, and Justification

Abstract

Questions were raised about Ashton's operationalization of each of the three pressure conditions and of the decision aid used. Participants were concerned that these specific treatment conditions might not always be representative of the general case. I discuss each of these conditions separately. First, there was a great deal of discussion regarding the tournament incentive scheme used in the paper versus other possible payment schemes. Participants argued that a good strategy in a tournament scheme is to choose high-variance outcomes. Some argued that in this case it would be irrational to use the decision aid (which was correct half the time), because to do so would ensure mediocre performance. In contrast, with a piece-rate scheme subjects may be less inclined to make risky decisions. Thus, conference participants questioned whether the conclusions would generalize across a broad range of incentive schemes. Second, because this was a difficult task and because the decision aid was correct only 50% of the time, subjects in the feedback condition most often received negative feedback. Do the results here merely indicate the