Performance Incentives, Divergent Thinking Training, and Creative Problem Solving

Abstract

ABSTRACTCreativity theory suggests that effective solutions to creative problems depend on both divergent and convergent thinking (Cropley 2006). Using an experiment in which participants solve insight problems, I investigate the effect of incentive schemes on creative problem-solving performance. I find that both piece-rate pay and a flat wage plus public recognition generate higher performance with divergent thinking training than without. Consistent with the idea that incentives may promote more convergent thinking than divergent thinking, piece-rate pay generates lower creative problem-solving performance than the flat wage in the absence of divergent thinking training (flat wage plus recognition has a neutral effect). The study suggests that when employee performance depends on creative problem solving, firms should implement incentive schemes and/or control systems that promote both divergent and convergent thinking.