TY  - RPRT
        AU  - Irlenbusch, Bernd
AU  - Sliwka, Dirk
        TI  - Incentives, Decision Frames, and Motivation Crowding Out – An Experimental Investigation
        PY  - 2005/Sep/
        PB  - Institute of Labor Economics (IZA)
        CY  - Bonn
        T2  - IZA Discussion Paper
        IS  - 1758
        UR  - https://www.iza.org/index.php/publications/dp1758
        AB  - A simple principal agent problem is experimentally investigated in which a principal repeatedly sets a wage and an agent responds by choosing an effort level. The principal's payoff is determined by the agent's effort. In a first setting the principal can only set a fixed wage in each period. In a second setting the principal has the possibility to supplement the fixed wage with a piece rate. Surprisingly, efforts are lower in the case where piece rates can be paid. Furthermore, switching in the same treatment from a setting where piece rates are available to one where only fixed wages can be paid tends to lead to even lower effort levels. Based on our findings we suggest a new explanation for motivation crowding out by arguing that the use of piece rates considerably alters the principals' and agents' perception of the situation.
        KW  - incentives
KW  - crowding-out
KW  - reciprocity
KW  - reputation
KW  - experiment
        ER  -