Team production: aligning targets and incentives

Last registered on March 19, 2024

Pre-Trial

Trial Information

General Information

Title
Team production: aligning targets and incentives
RCT ID
AEARCTR-0013176
Initial registration date
March 14, 2024

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
March 19, 2024, 5:18 PM EDT

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

Locations

Region

Primary Investigator

Affiliation
University of Neuch√Ętel

Other Primary Investigator(s)

PI Affiliation
University of Zurich

Additional Trial Information

Status
In development
Start date
2024-03-18
End date
2024-03-21
Secondary IDs
Prior work
This trial does not extend or rely on any prior RCTs.
Abstract
We study how team production responds to the alignment of performance targets and incentives. We design a lab experiment in which teams of two players have to complete a real-effort task and can check the progress of their partner in real time ("Team" condition). We consider a set of treatments in which individuals are subject to both piece-rate incentives and to either individual or group-level targets. Our objective is to measure how alternative target and punishment schemes affect team effort, as measured by the experimental task.
External Link(s)

Registration Citation

Citation
Kandul, Serhiy and Bruno Lanz. 2024. "Team production: aligning targets and incentives." AEA RCT Registry. March 19. https://doi.org/10.1257/rct.13176-1.0
Experimental Details

Interventions

Intervention(s)
Intervention Start Date
2024-03-19
Intervention End Date
2024-03-20

Primary Outcomes

Primary Outcomes (end points)
The primary outcome of the study is effort as measured by the experimental task.
Primary Outcomes (explanation)

Secondary Outcomes

Secondary Outcomes (end points)
The secondary outcome is willingness to pay to select preferred treatment and fairness perceptions.
Secondary Outcomes (explanation)

Experimental Design

Experimental Design
This is a computerized lab experiment that will take place at the research laboratory of the University of Zurich. We will recruit a sample of participants from a population of students. Participants will be randomly allocated to one of the experimental conditions in a between-subject design. Upon arrival participants randomly draw a seat number and proceed to the respective cubical in the lab. They will then read the experimental instructions, sign a consent form, and answer a few comprehension questions. All participants who signed the form and answered the comprehension question will proceed to the experiment, i.e. will perform a real effort task. The experimental condition defines how the participants are compensated for their work: in addition to a fixed show-up fee, participants receive a performance-based payment, which depends on the outcome of the real effort task. After completing a task, participants are informed about their payment and asked to fill a short questionnaire.
Experimental Design Details
Procedure
Step 1. Sliders with piece-rate payment (3mn): measure baseline individual performance
Step 2. Random assignment:
- group A (25%): Individual target / individual punishment
- group B (25%): Group target / group punishment
- group C (25%): Individual target / group punishment
- group D (25%): No target / no punishment (individual piece-rate)

Step 3. Draw pairs of participants at random, set target based on a pilot, provide information about target and show baseline performance of other team player and punishment (payment drops to zero if the target is not met)
Step 4. Sliders (3mn) with target / punishment, show real time information about teammate performance.
Step 5. Elicit WTP for an opportunity to switch to individual piece-rate. The switching is costly. Both players simultaneously (and independently without any communication) indicate how much they are willing to pay for their team to switch to the individual piece-rate scheme. They state any amount between 0 and XX CHF (let, say 10 CHF). We then randomly select one of the decision to be payoff-relevant. The computer draws a random number between 0 and 10. If the stated willingness to pay from the payoff-relevant decision is higher than the randomly drawn number, participants pay the price, and both switch to individual piece-rate. If the stated willingness to pay for the payoff-relevant decision is lower than the randomly drawn number, the team stays in the respective target/punishment scheme (group A, B, or C),and nobody pays. The payment, if any, comes from the show-up fee (no extra endowment).
For participants in group D, we use the same approach to elicit WTP to switch to group B.
Step 6. Sliders (3m) perform under group A, B, C or D; based on the outcome from WTP procedure.
Step 7. Determine payment/ Elicit fairness perceptions.
Randomization Method
Randomization is done by a computer in the lab.
Randomization Unit
Participant
Was the treatment clustered?
No

Experiment Characteristics

Sample size: planned number of clusters
About 400 individual participants (200 pairs).
Sample size: planned number of observations
About 400 individual participants (200 pairs)
Sample size (or number of clusters) by treatment arms
About 100 participants for each group (50 pairs).
Minimum detectable effect size for main outcomes (accounting for sample design and clustering)
IRB

Institutional Review Boards (IRBs)

IRB Name
Ethics commission for research of the University of Neuch√Ętel
IRB Approval Date
2024-01-08
IRB Approval Number
#117/2023

Post-Trial

Post Trial Information

Study Withdrawal

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Intervention

Is the intervention completed?
No
Data Collection Complete
Data Publication

Data Publication

Is public data available?
No

Program Files

Program Files
Reports, Papers & Other Materials

Relevant Paper(s)

Reports & Other Materials