It’s (Not) All About the Jacksons: Testing Different Types of Short-Term Bonuses in the Field
The use of short-term bonuses to motivate employees has become an organizational regularity, but a thorough understanding of the relationship between these incentives and actual performance is lacking. We aim to advance this understanding by examining how three types of bonuses (cash, family meal voucher, and verbal reward) affect employees’ productivity in a field experiment conducted in a high-tech manufacturing factory. While all types of bonuses increased performance by over 5%, nonmonetary short-term bonuses had a slight advantage over monetary bonuses. In addition, the removal of the bonuses led to decreased productivity for monetary bonuses but not for the verbal reward. However, this negative effect of monetary short-term bonuses diminishes when a cash bonus is chosen by employees rather than granted by default. Theoretical implications about the effect of short-term bonuses on intrinsic motivation and reciprocity, as well as practical applications of short-term bonus plans that stem from our findings, are discussed.
Duke Scholars
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- Business & Management
- 3507 Strategy, management and organisational behaviour
- 3505 Human resources and industrial relations
- 1505 Marketing
- 1503 Business and Management
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Published In
DOI
EISSN
ISSN
Publication Date
Volume
Issue
Start / End Page
Related Subject Headings
- Business & Management
- 3507 Strategy, management and organisational behaviour
- 3505 Human resources and industrial relations
- 1505 Marketing
- 1503 Business and Management