With Risk Comes Reward

Last registered on December 23, 2023


Trial Information

General Information

With Risk Comes Reward
Initial registration date
April 24, 2023

Initial registration date is when the trial was registered.

It corresponds to when the registration was submitted to the Registry to be reviewed for publication.

First published
May 03, 2023, 4:01 PM EDT

First published corresponds to when the trial was first made public on the Registry after being reviewed.

Last updated
December 23, 2023, 11:56 AM EST

Last updated is the most recent time when changes to the trial's registration were published.



Primary Investigator

University of Texas at Dallas

Other Primary Investigator(s)

PI Affiliation
PI Affiliation

Additional Trial Information

Start date
End date
Secondary IDs
Prior work
This trial does not extend or rely on any prior RCTs.
Pay inequality within companies is rising in modern economies. We design a lab and online experiment to examine team performance when leaders outearn their team members. We show that pay inequality causally undermines the ability of leaders to coordinate their teams (via leading by example), causing bad team performance despite aligned financial incentives. We then study whether exposing leaders to higher risk—measured by the cost they suffer when the team performs poorly—can justify inequality. We find that increased leader risk raises the perceived legitimacy of pay inequality. Remarkably, leaders anticipate the teams’ greater willingness to follow, which is necessary for teams to do well.
External Link(s)

Registration Citation

Dariel, Aurelie, Nikos Nikiforakis and Simon Siegenthaler. 2023. "With Risk Comes Reward." AEA RCT Registry. December 23. https://doi.org/10.1257/rct.11326-1.2
Experimental Details


Intervention Start Date
Intervention End Date

Primary Outcomes

Primary Outcomes (end points)
Percentage of orange choices (overall)
Percentage of orange choices (conditional on the leader choosing orange)
Relationship between risk aversion, inequality aversion (+expectations), conformity, and the percentage of orange choices
Differences in these variables between US and Nordic Countries subjects

Primary Outcomes (explanation)

Secondary Outcomes

Secondary Outcomes (end points)
Secondary Outcomes (explanation)

Experimental Design

Experimental Design
We consider 1 treatment without a leader and 5 treatments with a first-mover. In all treatments, the safe payoff is $4 for everyone. In all treatments, the two other group members have a LowPayoff of $2.75 and a HighPayoff of $4.75. The treatments vary in the incentives of the leader.

Change: After collecting these treatments, we decided to add one more treatment to obtain a more complete picture of the effect of leader risk. Specifically, we look also at the case when the leader earns no bonus but also has no risk.
Experimental Design Details
Randomization Method
Randomization done by the computer software: as the participants complete the experiment online, we will always assign the treatment with the lowest number of observations.
Randomization Unit
Was the treatment clustered?

Experiment Characteristics

Sample size: planned number of clusters
1400 individuals (independent observations)
Sample size: planned number of observations
1400 individuals
Sample size (or number of clusters) by treatment arms
7 Treatments with about 100 subjects in the US.
7 Treatments with about 100 subjects in the Nordic Countries, or as much as possible given limited availability.

Update: We have collected about half of the observations for the Nordic countries. Due to limited liquidity, we will now also include people from the Netherlands and France. The rationale is that these countries are geographically near the Nordic countries (EU), have Gini coefficients similar to the Nordic countries, and are sufficiently large so we are able to collect the remaining observations.
Minimum detectable effect size for main outcomes (accounting for sample design and clustering)

Institutional Review Boards (IRBs)

IRB Name
UTD Institutional Review Board
IRB Approval Date
IRB Approval Number
Analysis Plan

Analysis Plan Documents

Hypotheses for "With Risk Comes Reward" including one new treatment

MD5: 24069c7caf80c40d465a5a5ce8e0e187

SHA1: 6c561725a0b8ccde4adef6f22cb9979cd561c8c1

Uploaded At: September 22, 2023

Hypotheses for "With Risk Comes Reward"

MD5: a9cc7cb4e26a3cc4193034b6db89754b

SHA1: c5777df1676f2e4d7603550e6c10bd96aac7a63c

Uploaded At: April 24, 2023


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Is the intervention completed?
Data Collection Complete
Data Publication

Data Publication

Is public data available?

Program Files

Program Files
Reports, Papers & Other Materials

Relevant Paper(s)

Reports & Other Materials