Large Bonus Degrades Cognitive Performance
Sunday, December 7th, 2008
According to Dr. Ariely, a professor of behavioral economics at Duke, and author of the interesting book, Predictably Irrational, the offer of a huge bonus does not improve cognitive performance. He makes his argument in a recent piece in the New York Times, What’s The Value of A Big Bonus?.
In the article he describes several experiments that demonstrate those offered very large bonuses actually do worse on a cognitive task than those offered a medium or even small bonus.
Many have pointed out that money may not motivate those that think for a living. But this research goes further:
Given in the wrong dose (too much) money may worsen our performance on tasks that require learning, thinking, decision-making, creativity and other forms of cognition.
We need to be careful to design compensation and reward systems for how minds actually work, not how we think they should work.
