IDEAS home Printed from https://ideas.repec.org/p/ulp/sbbeta/2020-09.html
   My bibliography  Save this paper

Knowledge acquisition or incentive to foster coordination ? A real-effort weak-link experiment with craftsmen

Author

Listed:
  • Mathieu Lefebvre
  • Lucie Martin-Bonnel de Longchamp

Abstract

This paper presents a lab-in-the-field experiment with craftsmen working on renovation projects to assess the effect of training programs and incentive scheme on coordination and cooperation. Workers frequently fail to cooperate and coordinate their tasks when not supervised by a project coordinator. This is particularly important in the construction sector where it leads to a lack of final performance in buildings. We introduce two different incentives: a first contract paying craftsmen only according to their individual performance, and a second contract paying a group of three craftsmen with a weak-link payment according to the group’s worst performance. In addition, we test these incentives on two different subject groups: one is composed of craftsmen trained to coordinate their tasks, and the others are not. The results suggest that trained subjects coordinate at significantly higher effort levels than non-trained subjects when facing an individual-based incentive. However, when facing a group-based incentive, non-trained subjects seem to "catch up" trained subjects in terms of coordination level, while these latter subjects do not significantly increase their performance level.

Suggested Citation

  • Mathieu Lefebvre & Lucie Martin-Bonnel de Longchamp, 2020. "Knowledge acquisition or incentive to foster coordination ? A real-effort weak-link experiment with craftsmen," Working Papers of BETA 2020-09, Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg.
  • Handle: RePEc:ulp:sbbeta:2020-09
    as

    Download full text from publisher

    File URL: http://beta.u-strasbg.fr/WP/2020/2020-09.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Jordi Brandts & David J. Cooper, 2007. "It's What You Say, Not What You Pay: An Experimental Study of Manager–Employee Relationships in Overcoming Coordination Failure," Journal of the European Economic Association, MIT Press, vol. 5(6), pages 1223-1268, December.
    2. Ananish Chaudhuri & Sara Graziano & Pushkar Maitra, 2006. "Social Learning and Norms in a Public Goods Experiment with Inter-Generational Advice -super-1," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 73(2), pages 357-380.
    3. Jordi Brandts & David Cooper & Enrique Fatas, 2007. "Leadership and overcoming coordination failure with asymmetric costs," Experimental Economics, Springer;Economic Science Association, vol. 10(3), pages 269-284, September.
    4. Johannes Abeler & Armin Falk & Lorenz Goette & David Huffman, 2011. "Reference Points and Effort Provision," American Economic Review, American Economic Association, vol. 101(2), pages 470-492, April.
    5. Kopányi-Peuker, Anita & Offerman, Theo & Sloof, Randolph, 2018. "Team production benefits from a permanent fear of exclusion," European Economic Review, Elsevier, vol. 103(C), pages 125-149.
    6. Van Huyck, John B & Battalio, Raymond C & Beil, Richard O, 1990. "Tacit Coordination Games, Strategic Uncertainty, and Coordination Failure," American Economic Review, American Economic Association, vol. 80(1), pages 234-248, March.
    7. Riechmann, Thomas & Weimann, Joachim, 2008. "Competition as a coordination device: Experimental evidence from a minimum effort coordination game," European Journal of Political Economy, Elsevier, vol. 24(2), pages 437-454, June.
    8. Junichiro Ishida, 2006. "Team Incentives under Relative Performance Evaluation," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 15(1), pages 187-206, March.
    9. Arno Riedl & Ingrid M. T. Rohde & Martin Strobel, 2016. "Efficient Coordination in Weakest-Link Games," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 83(2), pages 737-767.
    10. Attanasi, Giuseppe & Hopfensitz, Astrid & Lorini, Emiliano & Moisan, Frédéric, 2016. "Social connectedness improves co-ordination on individually costly, efficient outcomes," European Economic Review, Elsevier, vol. 90(C), pages 86-106.
    11. Marchegiani, Lucia & Reggiani, Tommaso & Rizzolli, Matteo, 2016. "Loss averse agents and lenient supervisors in performance appraisal," Journal of Economic Behavior & Organization, Elsevier, vol. 131(PA), pages 183-197.
    12. van Dijk, Frans & Sonnemans, Joep & van Winden, Frans, 2001. "Incentive systems in a real effort experiment," European Economic Review, Elsevier, vol. 45(2), pages 187-214, February.
    13. Ananish Chaudhuri & Andrew Schotter & Barry Sopher, 2009. "Talking Ourselves to Efficiency: Coordination in Inter‐Generational Minimum Effort Games with Private, Almost Common and Common Knowledge of Advice," Economic Journal, Royal Economic Society, vol. 119(534), pages 91-122, January.
    14. Chen, Roy, 2017. "Coordination with endogenous groups," Journal of Economic Behavior & Organization, Elsevier, vol. 141(C), pages 177-187.
    15. Corgnet, Brice & Hernan-Gonzalez, Roberto & Rassenti, Stephen, 2015. "Peer Pressure and Moral Hazard in Teams: Experimental Evidence," Review of Behavioral Economics, now publishers, vol. 2(4), pages 379-403, December.
    16. Frederick W. Rankin, 2004. "Coordinating Effort under Team†Based and Individual Incentives: An Experimental Analysis," Contemporary Accounting Research, John Wiley & Sons, vol. 21(1), pages 191-222, March.
    17. Dai, Zhixin & Hogarth, Robin M. & Villeval, Marie Claire, 2015. "Ambiguity on audits and cooperation in a public goods game," European Economic Review, Elsevier, vol. 74(C), pages 146-162.
    18. Claude Meidinger & Jean-Louis Rullière & Marie-Claire Villeval, 2003. "Does Team-Based Compensation Give Rise to Problems When Agents Vary in Their Ability?," Experimental Economics, Springer;Economic Science Association, vol. 6(3), pages 253-272, November.
    19. Armin Falk & Andrea Ichino, 2006. "Clean Evidence on Peer Effects," Journal of Labor Economics, University of Chicago Press, vol. 24(1), pages 39-58, January.
    20. Nalbantian, Haig R & Schotter, Andrew, 1997. "Productivity under Group Incentives: An Experimental Study," American Economic Review, American Economic Association, vol. 87(3), pages 314-341, June.
    21. Jordi Brandts & David J. Cooper, 2006. "A Change Would Do You Good .... An Experimental Study on How to Overcome Coordination Failure in Organizations," American Economic Review, American Economic Association, vol. 96(3), pages 669-693, June.
    22. Radu Vranceanu & Fouad El Ouardighi & Delphine Dubart, 2015. "Team Production with Punishment Option: Insights from a Real‐Effort Experiment," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 36(6), pages 408-420, September.
    23. Ciccarone, Giuseppe & Di Bartolomeo, Giovanni & Papa, Stefano, 2020. "The rationale of in-group favoritism: An experimental test of three explanations," Games and Economic Behavior, Elsevier, vol. 124(C), pages 554-568.
    24. Hema A. Krishnan & Alex Miller & William Q. Judge, 1997. "Diversification and top management team complementarity: is performance improved by merging similar or dissimilar teams?," Strategic Management Journal, Wiley Blackwell, vol. 18(5), pages 361-374, May.
    25. Cooper, David J. & Ioannou, Christos A. & Qi, Shi, 2018. "Endogenous incentive contracts and efficient coordination," Games and Economic Behavior, Elsevier, vol. 112(C), pages 78-97.
    26. Dirk Engelmann & Hans-Theo Normann, 2010. "Maximum effort in the minimum-effort game," Experimental Economics, Springer;Economic Science Association, vol. 13(3), pages 249-259, September.
    27. Giuseppe Attanasi & Astrid Hopfensitz & Emiliano Lorini & Frederic Moisan, 2016. "Social connectedness improves co-ordination on individually costly, efficient outcomes," Post-Print hal-03188214, HAL.
    28. Bengt Holmstrom, 1982. "Moral Hazard in Teams," Bell Journal of Economics, The RAND Corporation, vol. 13(2), pages 324-340, Autumn.
    29. Claude Meidinger & Jean-Louis Rullière & Marie-Claire Villeval, 2003. "Does Team-Based Compensation Give Rise to Problems When Agents Vary in Their Ability?," Experimental Economics, Springer;Economic Science Association, vol. 6(3), pages 253-272, November.
    30. Bornstein, Gary & Gneezy, Uri & Nagel, Rosmarie, 2002. "The effect of intergroup competition on group coordination: an experimental study," Games and Economic Behavior, Elsevier, vol. 41(1), pages 1-25, October.
    31. Kandel, Eugene & Lazear, Edward P, 1992. "Peer Pressure and Partnerships," Journal of Political Economy, University of Chicago Press, vol. 100(4), pages 801-817, August.
    32. Bertrand Koebel & André Schmitt & Sandrine Spaeter, 2016. "DO SELF-THEORIES ON INTELLIGENCE EXPLAIN OVERCONFIDENCE AND RISK TAKING? A Field Experiment," Working Papers of BETA 2016-11, Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg.
    33. Robert Gibbons & John Roberts, 2012. "The Handbook of Organizational Economics," Economics Books, Princeton University Press, edition 1, volume 1, number 9889.
    34. Knez, Marc & Simester, Duncan, 2001. "Firm-Wide Incentives and Mutual Monitoring at Continental Airlines," Journal of Labor Economics, University of Chicago Press, vol. 19(4), pages 743-772, October.
    35. Croson, Rachel & Fatas, Enrique & Neugebauer, Tibor & Morales, Antonio J., 2015. "Excludability: A laboratory study on forced ranking in team production," Journal of Economic Behavior & Organization, Elsevier, vol. 114(C), pages 13-26.
    36. Blume, Andreas & Ortmann, Andreas, 2007. "The effects of costless pre-play communication: Experimental evidence from games with Pareto-ranked equilibria," Journal of Economic Theory, Elsevier, vol. 132(1), pages 274-290, January.
    37. Andrew Schotter & Barry Sopher, 2003. "Social Learning and Coordination Conventions in Intergenerational Games: An Experimental Study," Journal of Political Economy, University of Chicago Press, vol. 111(3), pages 498-529, June.
    38. Berninghaus, Siegfried K. & Ehrhart, Karl-Martin, 2001. "Coordination and information: recent experimental evidence," Economics Letters, Elsevier, vol. 73(3), pages 345-351, December.
    39. Carpenter, Jeffrey & Bowles, Samuel & Gintis, Herbert & Hwang, Sung-Ha, 2009. "Strong reciprocity and team production: Theory and evidence," Journal of Economic Behavior & Organization, Elsevier, vol. 71(2), pages 221-232, August.
    40. Roy Chen & Yan Chen, 2011. "The Potential of Social Identity for Equilibrium Selection," American Economic Review, American Economic Association, vol. 101(6), pages 2562-2589, October.
    41. Roberto Weber & Colin Camerer & Yuval Rottenstreich & Marc Knez, 2001. "The Illusion of Leadership: Misattribution of Cause in Coordination Games," Organization Science, INFORMS, vol. 12(5), pages 582-598, October.
    42. Bortolotti, Stefania & Devetag, Giovanna & Ortmann, Andreas, 2016. "Group incentives or individual incentives? A real-effort weak-link experiment," Journal of Economic Psychology, Elsevier, vol. 56(C), pages 60-73.
    43. Chen, Yan & Li, Sherry Xin & Liu, Tracy Xiao & Shih, Margaret, 2014. "Which hat to wear? Impact of natural identities on coordination and cooperation," Games and Economic Behavior, Elsevier, vol. 84(C), pages 58-86.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Arno Riedl & Ingrid M. T. Rohde & Martin Strobel, 2016. "Efficient Coordination in Weakest-Link Games," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 83(2), pages 737-767.
    2. Charness, Gary & Kuhn, Peter, 2011. "Lab Labor: What Can Labor Economists Learn from the Lab?," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 4, chapter 3, pages 229-330, Elsevier.
    3. Maoliang Ye & Jie Zheng & Plamen Nikolov & Sam Asher, 2020. "One Step at a Time: Does Gradualism Build Coordination?," Management Science, INFORMS, vol. 66(1), pages 113-129, January.
    4. Sandra Polania-Reyes, 2016. "Disentangling Social Capital: Lab-in-the-Field Evidence on Coordination, Networks, and Cooperation," Artefactual Field Experiments 00565, The Field Experiments Website.
    5. Fehr, Dietmar, 2017. "Costly communication and learning from failure in organizational coordination," European Economic Review, Elsevier, vol. 93(C), pages 106-122.
    6. Lu Dong & Maria Montero & Alex Possajennikov, 2018. "Communication, leadership and coordination failure," Theory and Decision, Springer, vol. 84(4), pages 557-584, June.
    7. Jeffrey Carpenter & Andrea Robbett & Prottoy A. Akbar, 2018. "Profit Sharing and Peer Reporting," Management Science, INFORMS, vol. 64(9), pages 4261-4276, September.
    8. Bronchal, Adrià, 2023. "Better the devil you know: The effects of group identity uncertainty on coordination efficiency," Journal of Economic Behavior & Organization, Elsevier, vol. 214(C), pages 634-656.
    9. Stefania Bortolotti & Giovanna Devetag & Andreas Ortmann, 2009. "Exploring the effects of real effort in a weak-link experiment," CEEL Working Papers 0901, Cognitive and Experimental Economics Laboratory, Department of Economics, University of Trento, Italia.
    10. Chen, Roy, 2017. "Coordination with endogenous groups," Journal of Economic Behavior & Organization, Elsevier, vol. 141(C), pages 177-187.
    11. Bortolotti, Stefania & Devetag, Giovanna & Ortmann, Andreas, 2016. "Group incentives or individual incentives? A real-effort weak-link experiment," Journal of Economic Psychology, Elsevier, vol. 56(C), pages 60-73.
    12. Giovanna Devetag & Andreas Ortmann, 2007. "When and why? A critical survey on coordination failure in the laboratory," Experimental Economics, Springer;Economic Science Association, vol. 10(3), pages 331-344, September.
    13. Brandts, Jordi & Corgnet, Brice & Hernán-González, Roberto & Ortiz, José Mª & Solà, Carles, 2021. "Watching or not watching? Access to information and the incentive effects of firing threats," Journal of Economic Behavior & Organization, Elsevier, vol. 189(C), pages 672-685.
    14. Kriss, Peter H. & Blume, Andreas & Weber, Roberto A., 2016. "Coordination with decentralized costly communication," Journal of Economic Behavior & Organization, Elsevier, vol. 130(C), pages 225-241.
    15. Peter H. Kriss & Roberto Weber, 2013. "Organizational formation and change: lessons from economic laboratory experiments," Chapters, in: Anna Grandori (ed.), Handbook of Economic Organization, chapter 14, Edward Elgar Publishing.
    16. Cooper, David J. & Ioannou, Christos A. & Qi, Shi, 2018. "Endogenous incentive contracts and efficient coordination," Games and Economic Behavior, Elsevier, vol. 112(C), pages 78-97.
    17. Baethge, Caroline & Fiedler, Marina, 2016. "Aligning mission preferences: Does self-selection foster performance in working groups?," Passauer Diskussionspapiere, Betriebswirtschaftliche Reihe B-18-16, University of Passau, Faculty of Business and Economics.
    18. Cason, Timothy N. & Savikhin, Anya C. & Sheremeta, Roman M., 2012. "Behavioral spillovers in coordination games," European Economic Review, Elsevier, vol. 56(2), pages 233-245.
    19. Cason, Timothy N. & Sheremeta, Roman M. & Zhang, Jingjing, 2012. "Communication and efficiency in competitive coordination games," Games and Economic Behavior, Elsevier, vol. 76(1), pages 26-43.
    20. Dietrichson, Jens & Gudmundsson, Jens & Jochem, Torsten, 2014. "Let's Talk It Over: Communication and Coordination in Teams," Working Papers 2014:2, Lund University, Department of Economics, revised 18 Apr 2018.

    More about this item

    Keywords

    Coordination; Real-effort weak-link experiment; Semi-Field Experiment; Individual Incentive; Group Incentive.;
    All these keywords.

    JEL classification:

    • C01 - Mathematical and Quantitative Methods - - General - - - Econometrics
    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior
    • C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ulp:sbbeta:2020-09. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: the person in charge (email available below). General contact details of provider: https://edirc.repec.org/data/bestrfr.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.