Abstract
This article studies the motivational power of hedonic noncash incentives compared to the motivational power of an equivalent amount of cash. In a laboratory study, working adults who engaged in a challenging mental task performed better in pursuit of a noncash incentive than in pursuit of a cash incentive of equal cash value, even though they stated a preference to receive the cash award. Justification concerns regarding the consumption and purchase of luxurious hedonic goods are found to be a major cause of this behavioral inconsistency. These findings suggest that firms must be careful in asking employees what incentives they prefer, because the preferred incentive may not be the one that leads to the best performance.
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Disclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.