Choking under time pressure: The influence of deadline-dependent bonus and malus incentive schemes on performance

Essl, Andrea Maria; Jaussi, Stefanie (2017). Choking under time pressure: The influence of deadline-dependent bonus and malus incentive schemes on performance. Journal of economic behavior & organization, 133, pp. 127-137. Elsevier 10.1016/j.jebo.2016.11.001

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Many economically relevant activities are executed under notable time pressures. Incentivized deadlines are often the reason people feel pressured. In such an environment, individual preferences can predict performance. Through a laboratory experiment, we xamine the predictive power of individual loss aversion on performance under deadline-dependent incentives. Participants worked on a real effort task under two payoff-equivalent contracts framed in bonus and malus terms. The results show lower performance for individuals with high loss aversion when working under a malus contract. These individuals needed more time to reply and were less able to avoid maluses than other individuals. Choking can explain this observed behavior.

Item Type:

Journal Article (Original Article)

Division/Institute:

03 Faculty of Business, Economics and Social Sciences > Department of Business Management > Institute of Organization and Human Resource Management > Organisation

UniBE Contributor:

Essl, Andrea Maria and Jaussi, Stefanie

Subjects:

600 Technology > 650 Management & public relations
300 Social sciences, sociology & anthropology > 330 Economics

ISSN:

0167-2681

Publisher:

Elsevier

Language:

English

Submitter:

Claudia Probst

Date Deposited:

20 Jul 2017 14:16

Last Modified:

11 Sep 2017 19:41

Publisher DOI:

10.1016/j.jebo.2016.11.001

Uncontrolled Keywords:

Deadline-dependent incentive schemes; Loss aversion; Choking under pressure; Laboratory experiment.

BORIS DOI:

10.7892/boris.91153

URI:

https://boris.unibe.ch/id/eprint/91153

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