Framing manipulations in contests : a natural field experiment
Document Type
Journal article
Source Publication
Journal of Economic Behavior & Organization
Publication Date
10-2015
Volume
118
First Page
372
Last Page
382
Publisher
Elsevier BV
Keywords
Framing effect, Field experiment, Worker productivity, Contests, Loss aversion, Incentive contracts
Abstract
Exploiting findings that losses loom larger than gains, studies have shown that framing manipulations can increase productivity of workers. Using a natural field experiment that exogenously manipulates wage bonuses within contests in a Chinese high-tech manufacturing facility, we show that how loss aversion affects worker behavior critically depends on the incentive scheme as well as the framing manipulation. Four sets of two identical teams competed against each other to win a bonus given to the team, within a set, with the higher average hourly productivity over the week. In each set, the bonus was framed as a reward or gain for one team and as a punishment or loss for the other. Average weekly productivity was slightly higher under the loss treatment, but this increase was statistically insignificant. However, the team under the loss treatment was at least 35% more likely to win the contest. As teams’ payoffs are based on relative productivity under a contest, framing effect is much stronger in terms of relative productivity. Finally, workers seemingly responded to the bonus by increasing the quality of production as well as quantity—defect rate fell as productivity increased.
DOI
10.1016/j.jebo.2015.02.014
Print ISSN
01672681
Funding Information
Funding for this research was provided by: Social Sciences and Humanities Research Council of Canada (489160) {489160}
Publisher Statement
Copyright © 2015 Elsevier B.V. All rights reserved.
Access to external full text or publisher's version may require subscription.
Full-text Version
Publisher’s Version
Language
English
Recommended Citation
Hong, F., Hossain, T., & List, J. A. (2015). Framing manipulations in contests: A natural field experiment. Journal of Economic Behavior & Organization, 118, 372-382. doi: 10.1016/j.jebo.2015.02.014