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This natural field experiment tests the effects of purely symbolic awards on volunteer retention in a public goods context. The experiment is conducted at Wikipedia, which faces declining editor retention rates, particularly among newcomers. Randomization assures that award receipt is orthogonal to previous performance. The analysis reveals that awards have a sizeable effect on newcomer retention, which persists over the four quarters following the initial intervention. This is noteworthy for indicating that awards for volunteers can be effective even if they have no impact on the volunteers’ future career opportunities. The awards are purely symbolic, and the status increment they produce is limited to the recipients’ pseudonymous online identities in a community they have just recently joined. The results can be explained by enhanced self-identification with the community, but they are also in line with recent findings on the role of status and reputation, recognition, and evaluation potential in online communities. Data, as supplemental material, are available at http://dx.doi.org/10.1287/mnsc.2016.2540 . This paper was accepted by John List, behavioral economics .

Research summary: Awards are a valuable strategic resource. Motivation theory and the emerging body of empirical literature suggest that awards can have a significant effect on employee motivation and corporate performance, though not always in the intended direction. Awards can also destroy value. The organizational award literature has so far largely neglected this important issue. We develop a synthesis of the dimensions critical for successful award bestowals, and analyze under which conditions awards generate firm-specific value that is sustained and difficult for competitors to imitate. The process of value creation and capture is contingent on the given firm's organizational characteristics and nature of production. The article concludes by laying out empirical implications. Managerial summary: Awards are widely used in the corporate sector. They fundamentally differ from monetary incentives, which risk crowding out employees' intrinsic motivation. Among the variety of awards, two general types can be distinguished: confirmatory awards based on explicit, pre-determined performance criteria, and discretionary awards, which rely on broad performance evaluations and may be used ex post to honor outstanding performance. Appropriately designed and adjusted to the specific firm's characteristics, awards enhance employees' motivation and corporate performance. They express recognition and support their recipients' perceived competence and social status. Awards help to retain valuable employees and to establish role models. However, awards may also backfire, for instance, when they provoke envy among coworkers. We propose when awards risk destroying value and when they are particularly useful.

Much recent research in economics focuses on exploring behavioral anomalies, i.e., systematic deviations from the assumptions of the rationally self-interested model of man. Laboratory studies are used to identify seeming inconsistencies with micro-economic theory on the level of individuals. Since economics is a social science, this article proposes that the next crucial step consists in shifting the focus to the macro-level. It examines the process through which behavioral anomalies are aggregated to a societal outcome. Since individuals are reactive when they interact with others and face institutional constraints, the aggregation process may lead to different outcomes than what has been observed in individual-level studies: the respective anomalies may disappear, or they may become stronger on the macro-level. The discussion demonstrates that there are a great number of aspects to be analyzed. The paper presents fragments of what could become a more extensive field of research.

Organizations miss out if their smartest members do not bring their ideas to the table. Gallus and Heikensten (2019) establish that gender differences play an important role for female participation in STEM fields (science, technology, engineering, and math). Moreover, they show that these differences can be eliminated by providing suitable forms of social recognition via awards. This article focuses on self-stereotyping and explores its role as a mechanism behind the effect of recognition on the gender gap in the tendency to speak up.

Policymakers and business leaders often use peer comparison information—showing people how their behavior compares to that of their peers—to motivate a range of behaviors. Despite their widespread use, the potential impact of peer comparison interventions on recipients’ well-being is largely unknown. We conducted a 5-mo field experiment involving 199 primary care physicians and 46,631 patients to examine the impact of a peer comparison intervention on physicians’ job performance, job satisfaction, and burnout. We varied whether physicians received information about their preventive care performance compared to that of other physicians in the same health system. Our analyses reveal that our implementation of peer comparison did not significantly improve physicians’ preventive care performance, but it did significantly decrease job satisfaction and increase burnout, with the effect on job satisfaction persisting for at least 4 mo after the intervention had been discontinued. Quantitative and qualitative evidence on the mechanisms underlying these unanticipated negative effects suggest that the intervention inadvertently signaled a lack of support from leadership. Consistent with this account, providing leaders with training on how to support physicians mitigated the negative effects on well-being. Our research uncovers a critical potential downside of peer comparison interventions, highlights the importance of evaluating the psychological costs of behavioral interventions, and points to how a complementary intervention—leadership support training—can mitigate these costs.

Purpose – The purpose of this paper is to shed light on a widely used yet scarcely investigated form of incentive, awards. The paper seeks to explore, first, whether awards can be used to motivate higher performance in academia and volunteering, and second, how often and in what forms awards are in actual fact being used in the voluntary sector. Design/methodology/approach – The paper combines a theoretical analysis with various analytical methods, including a new matching technique, randomization in the field, and the survey approach. Findings – Awards have the potential to substantially increase performance, yet they are less frequently used in the Swiss voluntary sector than theory suggests. Research limitations/implications – The focus lies on awards in academia and the voluntary sector. Future research should investigate awards in other fields, e.g. the for-profit or the cultural sector. It should also assess their use in other countries to facilitate cross-country comparisons. The effects on non-recipients and the public at large are another area worth investigating. Practical implications – Practitioners are encouraged to consider awards as an important motivational instrument, which could be integrated more explicitly and more widely in the volunteer management systems of Swiss non-profit organizations. Originality/value – This contribution analyzes a widely used yet scarcely investigated form of incentive, awards. originality/value derives naturally from this observation.

Happiness research is one of the most vivid and fruitful parts of modern economics. The focus is on empirical findings. In contrast, theoretical work has been rather neglected. The paper deals with three areas needing more analytical work: the choice or imposition of comparison or reference groups; and the extent, speed and symmetry of adaptation to positive and negative shocks on happiness. In both areas, theoretical propositions are derived which can in the future be empirically tested. The third area relates to the political economy of happiness. Many governments intend to take the happiness index as a criterion of how successful their policies are. As a consequence, survey respondents get an incentive to misrepresent their happiness level, and governments to manipulate the aggregate happiness indicator in their favor. A country’s constitution must induce governments to carefully observe human rights, democracy, the decentralization of political decision making, and market institutions and provide people with the possibility to acquire a good education and find a suitable job.

Much recent research in economics focuses on exploring behavioral anomalies, i.e., systematic deviations from the assumptions of the rationally self-interested model of man. Laboratory studies are used to identify seeming inconsistencies with micro-economic theory on the level of individuals. Since economics is a social science, this article proposes that the next crucial step consists in shifting the focus to the macro-level. It examines the process through which behavioral anomalies are aggregated to a societal outcome. Since individuals are reactive when they interact with others and face institutional constraints, the aggregation process may lead to different outcomes than what has been observed in individual-level studies: the respective anomalies may disappear, or they may become stronger on the macro-level. The discussion demonstrates that there are a great number of aspects to be analyzed. The paper presents fragments of what could become a more extensive field of research. [PUBLICATION ABSTRACT]

This paper analyses whether the aggregation of individual happiness scores to a National Happiness Index can still be trusted once governments have proclaimed their main objective to be the pursuit—or even maximization—of this National Happiness Index. The answer to this investigation is clear-cut: as soon as the National Happiness Index has become a policy goal, it can no longer be trusted to reflect people’s true happiness. Rather, the Index will be systematically distorted due to the incentive for citizens to answer strategically and the incentive for government to manipulate the Index in its favour. Such a distortion would arise even if the measurement of subjective well-being correctly reflected actual happiness before the intervention of government. Governments in a democracy should establish the conditions enabling individuals to become happy . The valuable and important results of happiness research should be introduced into the political process. Each person should be free to pursue happiness according to his or her preferences. This process is supported by obedience to the rule of law, human rights and free media, as well as by extended political participation rights, decentralized public decision-making, an open and effective education system fostering upward mobility and the possibility to find suitable employment.