Monetary and Social Incentives in Multi-Tasking: The Ranking Substitution Effect

Arbeitspapier

Rankings are prevalent information and incentive tools in labor markets with strong competition for talent. In a dynamic model of multi-tasking and an accompanying experiment with financial professionals, we identify hidden ranking costs when performance in one task is incentivized and ranked while another prosocial task is not: (i) a ranking influences behavior if individuals lag behind: they spend more total effort and substitute effort in the prosocial task with effort in the ranked task; (ii) those ahead in the ranking spend less total effort and lower relative effort in the ranked task. Implications for incentive schemes are discussed.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: IZA Discussion Papers ; No. 13345

Classification and Topics

• Classification: Wirtschaft ; Field Experiments ; Institutions: Design, Formation, Operations, and Impact ; Micro-Based Behavioral Economics: Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making‡
• Subject: multi-tasking decision problem ; rank incentives ; framed field experiment ; finance professionals

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Stefan, Matthias ; Huber, Jürgen ; Kirchler, Michael ; Sutter, Matthias ; Walzl, Markus
• Event: Veröffentlichung
• (who): Institute of Labor Economics (IZA)
• (where): Bonn
• (when): 2020

Further information

• Handle: http://hdl.handle.net/10419/223787
• Last update: 10.03.2025, 11:43 AM CET