Unintended consequences of performance incentives: impacts of framing and structure on performance and cheating

ABSTRACT

Setting specific, challenging goals motivates employees to exert greater effort in their jobs. However, goal-setting may have unintended consequences of also motivating unethical behavior. The present study explores these consequences in the context of other features of goal-setting in organizations, how goals are framed and rewarded, to determine the tradeoff between performance and ethical behavior. Undergraduate students were incentivized to complete math problems using different outcome frames and incentive structures and were also provided an opportunity to cheat. Findings demonstrate that when goals rewarded with piece-rate incentives are framed as a loss, performance increased, though cheating behavior increased as well.

KEYWORDS:

• Goal-setting
• task performance
• cheating

ACKNOWLEDGMENTS

Thanks to Nastassia Borjas, Coleen Corpuz, Gabriella Epshteyn, Jennifer Munoz, Komin Saikawa, Debra Zomberg for their assistance with data collection. Support for this project was provided by a PSC-CUNY Award (#61487-00 49), jointly funded by The Professional Staff Congress and The City University of New York. An earlier version of this manuscript received the 2019 Abraham Briloff Ethics Prize at Baruch College.

DATA AVAILABILITY STATEMENT

The data that support the findings of this study are available from the corresponding author, LW, upon reasonable request.

DISCLOSURE STATEMENT

No potential conflict of interest was reported by the authors.

Correction Statement

This article has been republished with minor changes. These changes do not impact the academic content of the article.

Notes

¹ We originally attempted to manipulate goal difficulty, but the manipulation was unsuccessful. Participants in both the high difficulty (complete 14 matrices) and low difficulty (complete 10 matrices) conditions found the task highly difficult, so this variable is not included in the analysis.

² The Big Five personality traits (extraversion, consciousness, agreeableness, intellect/imagination, and neuroticism) were also measured as covariates, but they were not used in the analysis since they were not statistically significant.

³ We thank an anonymous reviewer for this implication idea.