Outcome Feedback, Incentives, and Performance: Evidence from a Relatively Complex Forecasting Task

2012 ◽  
Vol 24 (2) ◽  
pp. 1-20 ◽  
Author(s):  
Steve Buchheit ◽  
Derek Dalton ◽  
Tom Downen ◽  
Sonja Pippin
Keyword(s):  
Financial Incentives ◽  
Feedback Loop ◽  
Study Data ◽  
Decision Makers ◽  
Data Availability ◽  
Improve Performance ◽  
Outcome Feedback ◽  
Outcome Information ◽  
Business Events ◽  
And Performance

ABSTRACT This study extends prior research by examining a fairly common sequence of business events: numeric outcome information is produced and reviewed, decisions are influenced by this information, and the process repeats (i.e., a feedback loop occurs). We find that incentivized decision makers exhibit substantial decision improvement after only one iteration of summary outcome feedback. In contrast, other between-subjects groups fail to improve performance across iterations of Luft and Shields' (2001) forecasting task. Our results suggest that financial incentives and outcome feedback are both critical to performance improvement in relatively complex iterative tasks. When either incentives or feedback is absent, performance suffers. While prior research has found outcome feedback relatively ineffective at improving complex task performance, our results indicate that outcome feedback and incentives complement each other to improve performance. We believe exploring the interaction of incentives and feedback offers interesting avenues for future accounting research. Data Availability: Study data are available from the authors upon request.

scholarly journals The Risk of Failure: Trial and Error Learning and Long-Run Performance

2019 ◽  
Vol 11 (1) ◽  
pp. 44-78 ◽  
Author(s):  
Steven Callander ◽  
Niko Matouschek
Keyword(s):  
Sufficient Conditions ◽  
Decision Makers ◽  
Risk Averse ◽  
Trial And Error ◽  
Improve Performance ◽  
Risk Of Failure ◽  
Long Run ◽  
Error Learning ◽  
And Performance ◽  
The Impact

Innovation is often the key to sustained progress, yet innovation itself is difficult and highly risky. Success is not guaranteed as breakthroughs are mixed with setbacks and the path of learning is typically far from smooth. How decision makers learn by trial and error and the efficacy of the process are inextricably linked to the incentives of the decision makers themselves and, in particular, to their tolerance for risk. In this paper, we develop a model of trial and error learning with risk averse agents who learn by observing the choices of earlier agents and the outcomes that are realized. We identify sufficient conditions for the existence of optimal actions. We show that behavior within each period varies in risk and performance and that a performance trap develops, such that low performing agents opt to not experiment and thus fail to gain the knowledge necessary to improve performance. We also show that the impact of risk reverberates across periods, leading, on average, to divergence in long-run performance across agents. (JEL D81, D83, O31, O38)

Transparency and performance in Islamic banking

2014 ◽  
Vol 7 (1) ◽  
pp. 61-88 ◽  
Author(s):  
Nada Lahrech ◽  
Abdelmounaim Lahrech ◽  
Youssef Boulaksil
Keyword(s):  
Generalized Least Squares ◽  
Profit Sharing ◽  
Study Data ◽  
Data Availability ◽  
Islamic Banking ◽  
Islamic Banks ◽  
Content Type ◽  
Management Incentives ◽  
And Performance ◽  
Banking Development

Purpose – The purpose of this paper is to assess whether Islamic banks are transparent regarding profit (and loss) sharing to investment account holders. Another objective is to appraise whether Islamic banks' performance affects management incentives to distribute profit (and loss) to investment account holders. Design/methodology/approach – To investigate the research issue, the authors conducted an empirical study. Data of 25 global operating Islamic banks have been collected and analyzed for the period 2006-2010. The authors also developed a mathematical model based on the generalized least-squares principle. Findings – The research results showed that enhancing transparency will prevent Islamic banks from shadowing their profit allocation practices and place investment account holders in a better position to manage their invested funds. The study also showed that bettering Islamic banks’performance will induce them to manager profit-sharing investment account holders’ funds under bonafides. Research limitations/implications – The main limitation is data availability. The maximum number of Islamic banks that disclose financial data covering the period of 2006-2010 limited the scope of the study to 25 banks. Practical implications – The findings are very valuable for designing policies and standards as well as for the enforcement of these standards to improve transparency in Islamic banking. Originality/value – The study outcome is vital to many parties involved in the Islamic banking field and can be taken as a strong foundation to make appropriate actions that would help grow and sustain Islamic banking development globally.

Negotiation-based Policy Instruments and Performance: Dutch Covenants and Environmental Policy Outcomes

2011 ◽  
Vol 31 (2) ◽  
pp. 187-208 ◽  
Author(s):  
Hans Bressers ◽  
Theo de Bruijn ◽  
Kris Lulofs ◽  
Laurence J. O'Toole
Keyword(s):  
Environmental Policy ◽  
Behavioral Change ◽  
Cost Minimization ◽  
Policy Instruments ◽  
Decision Makers ◽  
Policy Outcomes ◽  
Improve Performance ◽  
Negotiated Agreements ◽  
And Performance ◽  
Policy Setting

AbstractNumerous governments have adopted innovative policy instruments to deal with important environmental policy challenges and negotiated instruments offer the potential to improve performance beyond what regulation alone can accomplish. Dutch covenants, which represent negotiated agreements with sectors of industry as targets of behavioral change, provide useful evidence of the determinants of success. For improving environmental performance, certain features of the policy setting explain much of the variance in ambitions and outcomes: attitudes of decision makers in the affected businesses, attention to cost minimization, and possibly the degree of ambition built into the agreement. Modeling to explain the extent of ambition and compliance offer further insights. While some Dutch lessons may be restricted to more corporatist policy settings, others may help improve the effectiveness of negotiated agreements in many national settings.

Choices in a key press decision-making task are more optimal after gaining both aiming and reward experience

2020 ◽  
Vol 73 (12) ◽  
pp. 2197-2216
Author(s):  
Joseph X Manzone ◽  
Saba Taravati ◽  
Heather F Neyedli ◽  
Timothy N Welsh
Keyword(s):  
Spatial Information ◽  
Group Level ◽  
Movement Variability ◽  
Outcome Feedback ◽  
A Value ◽  
Expected Gain ◽  
Outcome Information ◽  
Key Press ◽  
Spatial Parameters ◽  
And Performance

When presented with two different target–penalty configurations of similar maximum expected gain (MEG), participants prefer aiming to configurations with more advantageous spatial, rather than more advantageous gain parameters—perhaps due to the motor system’s inherent prioritisation of spatial information during movements with high accuracy demands such as aiming. To test this hypothesis, participants in the present studies chose between target–penalty configurations via key presses to reduce the importance of spatial parameters of the response and performance-related feedback. Configurations varied in spatial (target–penalty region overlap) and gain parameters (negative penalty values) and could have similar or different MEG. Choices were made without prior aiming experience (Experiment 1), after aiming experience provided information of movement variability (Experiment 2), or after aiming experience provided information of movement variability and outcome feedback (Experiment 3). Overall, configurations with advantageous spatial or gain parameters were chosen equally (Both-Similar condition) in all experiments. However, average behaviour at the group level was not reflective of the behaviour of most individual participants with three subgroups emerging: those with a value preference, distance preference, or no preference. In Experiments 1 and 2, these individual differences cannot be explained by MEG differences between configurations or participants’ movement variability, but these variables predicted choice behaviour in Experiment 3. Further in the Both-Different condition, participants only selected the larger MEG configuration at a level above chance when both variability and outcome information were given prior to the key press task (Experiment 3). In sum, the data indicate that prioritisation of spatial information did not emerge at the group level when performing key presses and more optimal behaviour emerged when information regarding movement variability and outcome feedback were given.

The Relation Between Financial Incentives, Motivation, and Performance

2017 ◽  
Vol 16 (2) ◽  
pp. 61-76 ◽  
Author(s):  
Anaïs Thibault Landry ◽  
Marylène Gagné ◽  
Jacques Forest ◽  
Sylvie Guerrero ◽  
Michel Séguin ◽  
...  
Keyword(s):  
Financial Incentives ◽  
Work Performance ◽  
Autonomous Motivation ◽  
Compensation Plans ◽  
Work Settings ◽  
Path Analyses ◽  
Three Samples ◽  
And Performance ◽  
Performance Results

Abstract. To this day, researchers are debating the adequacy of using financial incentives to bolster performance in work settings. Our goal was to contribute to current understanding by considering the moderating role of distributive justice in the relation between financial incentives, motivation, and performance. Based on self-determination theory, we hypothesized that when bonuses are fairly distributed, using financial incentives makes employees feel more competent and autonomous, which in turn fosters greater autonomous motivation and lower controlled motivation, and better work performance. Results from path analyses in three samples supported our hypotheses, suggesting that the effect of financial incentives is contextual, and that compensation plans using financial incentives and bonuses can be effective when properly managed.

Replication of the Superstition and Performance Study by

2014 ◽  
Vol 45 (3) ◽  
pp. 239-245 ◽  
Author(s):  
Robert J. Calin-Jageman ◽  
Tracy L. Caldwell
Keyword(s):  
Task Difficulty ◽  
Statistical Power ◽  
Meta Analysis ◽  
A Priori ◽  
Significant Heterogeneity ◽  
Performance Study ◽  
Improve Performance ◽  
Research Designs ◽  
Series Of Experiments ◽  
And Performance

A recent series of experiments suggests that fostering superstitions can substantially improve performance on a variety of motor and cognitive tasks ( Damisch, Stoberock, & Mussweiler, 2010 ). We conducted two high-powered and precise replications of one of these experiments, examining if telling participants they had a lucky golf ball could improve their performance on a 10-shot golf task relative to controls. We found that the effect of superstition on performance is elusive: Participants told they had a lucky ball performed almost identically to controls. Our failure to replicate the target study was not due to lack of impact, lack of statistical power, differences in task difficulty, nor differences in participant belief in luck. A meta-analysis indicates significant heterogeneity in the effect of superstition on performance. This could be due to an unknown moderator, but no effect was observed among the studies with the strongest research designs (e.g., high power, a priori sampling plan).

Theoretizing A New Sustainable Business Event: Extension of Mair and Jago Model

2015 ◽  
Vol 3 (2) ◽  
pp. 55
Author(s):  
Norol Hamiza Zamzuri ◽  
Khairil Wahidin Awang ◽  
Yuhanis Abdul Aziz ◽  
Zaiton Samdin
Keyword(s):  
Social Impact ◽  
Geographical Area ◽  
Infrastructure Development ◽  
Structured Interviews ◽  
Sustainable Business ◽  
Knowledge Resources ◽  
Business Events ◽  
And Performance ◽  
Event Based

The growth of the event sector is underpinned by the demand of organizing a business event.  Thus, it leads to an increase in economic and social impact. However, the problems from the growth of this sector potentially results from the use of several event materials, transportation and infrastructure development.  Organizing a green event is seen as one of the strategies to reduce the environmental impact.  Therefore, the aim of this paper is to explore the issues involved throughout the process of greening an event by applying Mair and Jago Model.  Semi-structured interviews were conducted with event managers from six Malaysia business event companies that encourage green practices during their event.  Findings suggest that impact, initiative, support and performance motivates event organizers in organizing a green event.  It has also been found that knowledge, resources and behaviour are the barriers faced by event organizers throughout the process of organizing a green event.  Based on the findings it appears that two important factors have emerged from the data collection and analysis that showed a deviation from the Mair and Jago Model, namely “impact” for the motivation element and “support” for the barrier element.  The main limitation of this study was the scope of the study; as it only focuses on business events.  However, as the main purpose of this study is to explore the issues of organizing a green event, it has been found that there are other issues need to be explored in other contexts and geographical area.  Apart from this, as this is a case study, it can only replicate according to the circumstances of this case study. However, this study can be generalized in terms of the theory that has emerged from it.  It is suggested that further research should explore more issues in other contexts and geographical areas. 

scholarly journals PSX-8 Effects of dietary concentrate level and limited feed access on feed intake and performance by lactating Alpine dairy goats

2020 ◽  
Vol 98 (Supplement_4) ◽  
pp. 455-456
Author(s):  
Luana P Ribeiro ◽  
Ryszard Puchala ◽  
Terry A Gipson ◽  
Raquel V Lourencon ◽  
Arthur L Goetsch
Keyword(s):  
Feed Intake ◽  
Milk Fat ◽  
Protein Concentration ◽  
Free Choice ◽  
Energy Yield ◽  
Dairy Goats ◽  
Improve Performance ◽  
Entire Study ◽  
And Performance ◽  
Concentrate Level

Abstract The objective was to determine if effects of different limited feed access treatments on performance by lactating Alpine dairy goats vary with dietary concentrate level. Primiparous (29; 55.2±0.8 kg BW) and multiparous Alpine goats (29; 70.2±1.06 kg) were used in a 24-wk study of 3 8-wk phases beginning at 7.1±0.37 d after kidding. Diets of 40 or 60% concentrate (40C and 60C, respectively) were offered free choice in Calan gate feeders, with access continuously (CON), for 8 h between morning and afternoon milkings (DAY), or for 2 h after each milking (FRH). Although there were many interactions involving phase, ADG during the entire study was greater for CON vs. FRH (P < 0.05; -20, -41, and -61 g for CON, DAY, and FRH, respectively; SEM = 8.6). Intake of DM also was greater for CON than for FRH (P < 0.05; 2.17, 2.03, 2.01, 2.29, 2.07, and 1.80 kg/d for 40C-CON, 40C-DAY, 40C-FRH, 60C-CON, 60C-DAY, and 60C-FRH, respectively; SEM=0.093). There were interactions (P < 0.02) between concentrate level and access treatment in milk yield (2.55, 2.41, 2.61, 3.21, 2.66, and 2.27 kg/d; SEM=0.103) and protein concentration (2.65, 2.55, 2.60, 2.67, 2.70, and 2.49%; SEM = 0.042), and milk fat concentration was greatest among treatments (P < 0.05) for FRH (2.79, 2.77, 3.18, 2.86, 2.89, and 3.02% for 40C-CON, 40C-DAY, 40C-FRH, 60C-CON, 60C-DAY, and 60C-FRH, respectively; SEM=0.103). As a consequence, milk energy yield was 6.14, 5.70, 6.67, 7.83, 6.58, and 5.61 MJ/d (SEM=0.251) and the ratio of milk energy to DMI was 3.01, 2.87, 3.37, 3.47, 3.28, and 3.18 MJ/kg for 40C-CON, 40C-DAY, 40C-FRH, 60C-CON, 60C-DAY, and 60C-FRH, respectively; SEM=0.123). Overall, limited feeder access treatments did not improve performance and, in fact, the shortest access treatment increased BW loss; however, efficiency of feed DM usage for milk energy yield was not adversely impacted.

Choice and privatisation in Swedish primary care

2010 ◽  
Vol 6 (4) ◽  
pp. 549-569 ◽  
Author(s):  
Anders Anell
Keyword(s):  
Primary Care ◽  
Clinical Practice ◽  
Financial Incentives ◽  
Degrees Of Freedom ◽  
New Wave ◽  
Improve Performance ◽  
Financial Responsibility ◽  
New Models ◽  
Financial Characteristics

AbstractIn 2007, a new wave of local reforms involving choice for the population and privatisation of providers was initiated in Swedish primary care. Important objectives behind reforms were to strengthen the role of primary care and to improve performance in terms of access and responsiveness. The purpose of this article was to compare the characteristics of the new models and to discuss changes in financial incentives for providers and challenges regarding governance from the part of county councils. A majority of the models being introduced across the 21 county councils can best be described as innovative combinations between a comprehensive responsibility for providers and significant degrees of freedom regarding choice for the population. Key financial characteristics of fixed payment and comprehensive financial responsibility for providers may create financial incentives to under-provide care. Informed choices by the population, in combination with reasonably low barriers for providers to enter the primary care market, should theoretically counterbalance such incentives. To facilitate such competition is indeed a challenge, not only because of difficulties in implementing informed choices but also because the new models favour large and/or horizontally integrated providers. To prevent monopolistic behaviour, county councils may have to accept more competition as well as more governance over clinical practice than initially intended.

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