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The Role of Goals and Feedback in Incentivizing Performance

Author

Listed:
  • Zafer Akýn

    (Department of Economics, Ipek University)

  • Emin Karagözoðlu
Abstract
In this paper, we experimentally investigate how goal setting and feedback policies affect work performance. In particular, we study the effects of (i) absolute performance feedback, (ii) self-specified goals and (iii) exogenous goals and relative performance feedback. Our results show that the average performance of the subjects who are provided self-performance feedback is 11% lower than the ones who get no feedback. Moreover, setting a non-binding personal goal does not affect performance. Finally, assigning an exogenous goal and providing relative performance feedback decreases performance by 8%. We discuss the insights our findings offer for the optimal design of goal setting and feedback mechanisms.

Suggested Citation

  • Zafer Akýn & Emin Karagözoðlu, 2015. "The Role of Goals and Feedback in Incentivizing Performance," IPEK Working Papers 1506, Ipek University, Department of Economics, revised Aug 2015.
    • Handle: RePEc:ipk:wpaper:1506
    as

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    References listed on IDEAS

    as
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    Full references (including those not matched with items on IDEAS)

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    Cited by:

    1. Dalmia, Prateik & Filiz-Ozbay, Emel, 2021. "Your success is my motivation," Journal of Economic Behavior & Organization, Elsevier, vol. 181(C), pages 49-85.
    2. Koch, Alexander K. & Nafziger, Julia, 2020. "Motivational goal bracketing: An experiment," Journal of Economic Theory, Elsevier, vol. 185(C).
    3. Markus Jung & Mischa Seiter, 2021. "Towards a better understanding on mitigating algorithm aversion in forecasting: an experimental study," Journal of Management Control: Zeitschrift für Planung und Unternehmenssteuerung, Springer, vol. 32(4), pages 495-516, December.
    4. James Fan & Joaquín Gómez‐Miñambres & Samuel Smithers, 2020. "Make it too difficult, and I'll give up; let me succeed, and I'll excel: The interaction between assigned and personal goals," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 41(6), pages 964-975, September.
    5. Hoffmann, Christin & Thommes, Kirsten, 2020. "Can digital feedback increase employee performance and energy efficiency in firms? Evidence from a field experiment," Journal of Economic Behavior & Organization, Elsevier, vol. 180(C), pages 49-65.

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    More about this item

    Keywords

    Feedback; Goal; Relative Performance; Piece-rate; Motivation;
    All these keywords.

    JEL classification:

    • M50 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - General

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