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Anreize zu produktiven und destruktiven Anstrengungen durch relative Entlohnung

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  • Christine Harbring

    (Universität Bonn)

  • Bernd Irlenbusch

    (Universität Erfurt)

Abstract

Summary If organizations implement incentive systems in which rewards depend on relative rather than on absolute performance, activities are induced from at least two dimensions: (i) productive activities increase the own output of an agent whereas (ii) destructive ones (called sabotage) reduce the output of the competitors. Unfortunately, the sabotage dimension is quite hard to be investigated in real organizations because in general this activity is undesired and therefore strictly forbidden. The present paper aims to fill this gap by an experimental approach which provides clear evidence of the influence of the fraction of winner prizes and the size of the prize difference on both activity dimensions. Contrary to the game-theoretic prediction the productive activity is highest for non-experienced participants in tournaments with a balanced fraction of winner and loser prizes. Moreover, the amount of destructive effort exerted is inefficiently high in relation to the productive effort. This sabotage problem is exacerbated by an increase in the prize difference.

Suggested Citation

  • Christine Harbring & Bernd Irlenbusch, 2004. "Anreize zu produktiven und destruktiven Anstrengungen durch relative Entlohnung," Schmalenbach Journal of Business Research, Springer, vol. 56(6), pages 546-576, September.
    • Handle: RePEc:spr:sjobre:v:56:y:2004:i:6:d:10.1007_bf03372749
    DOI: 10.1007/BF03372749
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    References listed on IDEAS

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    More about this item

    Keywords

    C9; D2; J3; M1;
    All these keywords.

    JEL classification:

    • C9 - Mathematical and Quantitative Methods - - Design of Experiments
    • D2 - Microeconomics - - Production and Organizations
    • J3 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs
    • M1 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration

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