Incentive Designs with Uncertainty: Keep the Hope Alive

Xiyueyao Luo, Luxi Shen

Research output: Contribution to ConferencePosterProfessional

Abstract

While extant JDM literature shows that reward uncertainty can boost motivation, the present research takes a unique perspective on reward uncertainty and solves an optimization problem—how uncertainty maximizes the effort investment while holding the outcome payoff constant. Specifically, we consider an effort-score-payoff labor chain and locate uncertainty (randomness) either between “effort-score” or between “score-payoff” to structure the uncertain reward. Four studies found that adding uncertainty between “score” and “payoff” is more motivating. We explain this effect with the notion of keeping the hope alive. This research provides nuanced understandings about the psychology of reward uncertainty.
Original languageEnglish
Publication statusPublished - 16 Nov 2018
EventSociety for Judgment and Decision Making - Hyatt Regency hotel, New Orleans, United States
Duration: 16 Nov 201819 Nov 2018
http://sjdm.org/newsletters/18-oct.pdf

Conference

ConferenceSociety for Judgment and Decision Making
CountryUnited States
CityNew Orleans
Period16/11/1819/11/18
Internet address

Keywords

  • Uncertainty
  • Incentive (reward)
  • effort investment
  • motivation
  • hope

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