Motivating social compliance in a multi-tier supply chain framework: Experimental evidence on the role of framing and financial incentives

Last registered on July 05, 2025
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Pre-Trial

Trial Information

General Information

Title
Motivating social compliance in a multi-tier supply chain framework: Experimental evidence on the role of framing and financial incentives
RCT ID
AEARCTR-0015674
Initial registration date
March 30, 2025

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
April 03, 2025, 1:03 PM EDT

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

Last updated
July 05, 2025, 5:08 AM EDT

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

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Primary Investigator

Name
Nikita Grabher-Meyer
Affiliation
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Other Primary Investigator(s)

PI Name
Amrish Patel
PI Affiliation
PI Name
Oana Borcan
PI Affiliation
UEA
Contact Investigator
PI Name
Thedore Turocy
PI Affiliation

Additional Trial Information

Status
In development
Start date
2025-03-30
End date
2026-03-31
Keywords
Behavior, Firms & Productivity, Governance
Additional Keywords
social compliance, multi-tier supply chain, online experiment
JEL code(s)
Secondary IDs
Prior work
This trial does not extend or rely on any prior RCTs.
Abstract
The 2013 Rana Plaza collapse exposed the limits of private regulatory models that rely on multinational corporations to enforce supplier codes of conduct through audits. In today’s complex, multi-tier global supply chains, lead firms often lack visibility beyond their direct suppliers, where the most severe labor violations tend to occur. To manage reputational and financial risks, buyers increasingly delegate the task of monitoring sub-suppliers to first-tier suppliers, who face competing pressures to reduce costs while ensuring social compliance. This study examines how perceptions of fairness and reciprocity influence first-tier suppliers’ efforts to uphold labor standards within their own operations and among sub-suppliers. We implement a novel online experiment with over 500 South African participants, simulating a three-tier supply chain with a lead firm (Alpha), a first-tier supplier (Beta), and a second-tier supplier (Gamma). Participants assigned to Beta are randomly allocated to one of three treatment conditions that vary the framing of Alpha’s compliance demands and the presence of financial incentives. We test whether Beta increases monitoring of Gamma and improves compliance when Alpha adopts a more collaborative, procedurally fair approach, with and without monetary incentives.
External Link(s)

Registration Citation

Citation
Borcan, Oana et al. 2025. "Motivating social compliance in a multi-tier supply chain framework: Experimental evidence on the role of framing and financial incentives ." AEA RCT Registry. July 05. https://doi.org/10.1257/rct.15674-2.1
Sponsors & Partners
Experimental Details

Interventions

Intervention(s)
This study investigates how different communication strategies from a lead firm (buyer) affect supplier compliance behaviour within a stylized, multi-tier global supply chain. Specifically, we examine how variations in the framing of compliance expectations – focusing on collaboration, procedural fairness, and the presence or absence of monetary incentives – influence suppliers’ compliance decisions. The intervention manipulates the tone and content of compliance messages from the buyer to assess their effects on two key outcomes: the supplier’s effort to monitor upstream subcontractors and their own compliance performance.
Intervention Start Date
2025-03-30
Intervention End Date
2025-05-30

Primary Outcomes

Primary Outcomes (end points)
Participants are assigned the role of a first-tier supplier responsible for: 1) Completing a production task; 2) Ensuring compliance with labor standards, and 3) Choosing how much effort to invest in monitoring their upstream subcontractors. We define two primary outcome measures: 1) Monitoring effort, measured as the number of seconds the participant allocates to subcontractor inspection, as determined by their selected inspection policy; 2) Compliance performance, measured by the number of correctly transcribed items in a compliance-focused (transcription) task.
Primary Outcomes (explanation)

Secondary Outcomes

Secondary Outcomes (end points)
To investigate potential mechanisms, we will measure participants’ perceptions of fairness in relation to the compliance expectations communicated by the buyer. This will be assessed post-task using a 10-point Likert scale ranging from 1 (“completely disagree”) to 10 (“completely agree”) in response to a statement regarding perceived fairness. This outcome helps evaluate whether collaborative framing alters suppliers’ normative responses.
Secondary Outcomes (explanation)

Experimental Design

Experimental Design
We conduct a randomized online experiment with participants drawn from the general working population in a country representative of sourcing environments. Each participant takes on the role of a first-tier supplier responsible for allocating limited time across production, compliance, and monitoring tasks. Participants are randomly assigned to one of three treatment conditions, which vary how compliance expectations are communicated by the lead firm. The treatment arms differ in message framing (traditional vs. collaborative) and in the inclusion of a monetary incentive for reporting non-compliance by subcontractors. To ensure consistency and realism, decisions made by upstream and downstream actors (e.g., the buyer or subcontractor) are collected in advance and matched to participants ex post during the main experiment. Randomization is implemented by Prolific at the individual level, with equal probability of assignment to any treatment group.
Experimental Design Details
Not available
Randomization Method
The randomisation is implemented by Prolific, and participants have an equal probability to be assigned to any treatment group.
Randomization Unit
The primary unit of randomisation is the individual participant.
Was the treatment clustered?
No

Experiment Characteristics

Sample size: planned number of clusters
N/A
Sample size: planned number of observations
A total of 561 individuals were recruited via Prolific, 427 of whom played the main role of first-tier suppliers.
Sample size (or number of clusters) by treatment arms
Approximately 135-145 individuals per treatment arm (136 individuals in control, 144 individuals in treatment with framing only, 147 individuals in treatment with both framing and monetary incentive).
Minimum detectable effect size for main outcomes (accounting for sample design and clustering)
N/A
Supporting Documents and Materials
IRB

Institutional Review Boards (IRBs)

IRB Name
School of Economics Research Ethics Subcommittee, UEA
IRB Approval Date
2024-09-19
IRB Approval Number
ETH2425-0106
Analysis Plan

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