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Pay Enough or Don't Pay at All*

Gneezy, Uri, Rustichini, Aldo·2000·Quarterly Journal of Economics

DOI 10.1162/003355300554917

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Abstract

Economists usually assume that monetary incentives improve performance, and psychologists claim that the opposite may happen. We present and discuss a set of experiments designed to test these contrasting claims. We found that the effect of monetary compensation on performance was not monotonic. In the treatments in which money was offered, a larger amount yielded a higher performance. However, offering money did not always produce an improvement: subjects who were offered monetary incentives performed more poorly than those who were offered no compensation. Several possible interpretations of the results are discussed.

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Authors: Gneezy, U., & Rustichini, A.
Affiliations: Boston University (US)
ORCID: Rustichini, Aldo
Venue: Quarterly Journal of Economics
Publisher: Oxford University Press (OUP)
Published: 2000-08
Volume: 115
Issue: 3
Pages: 791-810
ISSN: 0033-5533 (ISSN-L)
1531-4650
DOI: 10.1162/003355300554917
OpenAlex: W2168112513
Cited by: 2,175
References: 44
Citations by year: 2026: 61 · 2025: 67 · 2024: 70 · 2023: 127 · 2022: 78 · 2021: 126 · 2020: 93 · 2019: 111 · 2018: 93 · 2017: 119 · 2016: 138 · 2015: 140 · 2014: 132 · 2013: 129 · 2012: 109
FWCI: 57.67
Type: journal article
Language: en
Open access: closed
Locations: The Quarterly Journal of Economics (publishedVersion)
Research portal (Tilburg University) (submittedVersion)
RePEc: Research Papers in Economics (submittedVersion)
HighWire Press Open Archive (submittedVersion)
Topics: Social Sciences › Economics, Econometrics and Finance › Economics and Econometrics › Experimental Behavioral Economics Studies
Social Sciences › Decision Sciences › General Decision Sciences › Decision-Making and Behavioral Economics
Social Sciences › Business, Management and Accounting › Accounting › Accounting and Organizational Management
Keywords: financial incentives, financial compensation, performance, incentive effects, non-monetary incentives, non-monotonic effects

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