Large Bonus Degrades Cognitive Performance
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.
May 17th, 2009 at 12:52 pm
Enjoying reading your blog. Hard work always pays off.