Higher pay equals worse performance

The Pop!Tech ’09 event is taking place this week, and GOOD magazine is providing summaries of the what the star-studded cast of speakers have been presenting. (You can watch a live stream of the Pop!Tech here.)

Yesterday, Dan Ariely, author of 2009's Predictably Irrational: The Hidden Forces that Shape Our Decisions, spoke at Pop!Tech about an experiment he recently conducted. He gave mental tasks to three groups of volunteers, offering different cash amounts for correct answers. The first group was told they'd get a day's wages for performing well; the second group would get more than that; the third group would get five months' pay.

You would expect that the third group would do the best, because they were being offered a bigger reward. But the actual results (shown here in the graph) tell a different story. The third group performed far worse than the first group. Why is that? Ariely sums it up to performance anxiety. Money is a motivator as well as a stress-inducer, explained Ariely. With so much at stake, the volunteers had a harder time concentrating on the assignment.

I wish I hadn't missed the video, because I have a question about the experiment that Ariely might have cleared up -- did he really reward five months' salary to the volunteers of the third group who performed well? If so, he must have one heck of a research budget!

Mark Frauenfelder – Editor-in-chief of MAKE magazine and the founder of the popular Boing Boing weblog, Mark was an editor at Wired from 1993-1998 and is the founding editor of Wired Online.

Comments

[darkfall gold]

good article