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Incentive overlap example[edit]

I've moved part of the last paragraph of the first section, as the article has been restructured, off the page to here:cgghfghsh

[In American society where social, economic, and cultural success are inextricably intertwined ...] Similarly, in this highly competitive society with a weakening social safety net, remunerative incentives have become, de facto, coercive. An individual who loses his or her job may experience drastic and highly stressful life changes, including forced relocations, loss of possessions, and humilation.

I've moved this for a couple of reasons. The first is that I think it involves a confusion about the taxonomy of incentives that structures the article: coercive incentives, as defined, are incentives that are carried by situations where physical violence is threatened, or used, against person or property. It's a mistake, I think, to suggest that going into debt or facing a lot of stress, or being treated like crap (undeservedly) by other people ends up being a coercive incentive, de facto or otherwise. Humiliation by others is a straightforward example of a moral disincentive (in the sense of acting out social norms, not necessarily in the sense of a personal sense of duty); stress is straightforwardly a personal (emotional) disincentive; and running out of money and having to downgrade or suddenly change living conditions due to money or job constraints are entirely within the realm of remunerative disincentives (if I don't do P, then I won't have the money that I need to keep doing Q).

Of course these are like a coercive incentive in important respects--they are all very unpleasant, and may even (in the case of extreme poverty) endanger the happiness, health, or even the life of the person facing them. But all disincentives are in some respect unpleasant (that's why they are all categoried as disincentives); and the severity of the situation that the person faces impacts how extreme the disincentive is, but not whether physical violence is being employed.

You might, of course, argue that if you're facing (say) starvation out of extreme poverty, then the situation you're in is like a situation in which your life is threatened by violence in all relevant respects (i.e., that the difference between the non-coerced and the coerced threat of starvation is not a particularly important one for the person deciding what to do, and perhaps that it shouldn't be relevant for public policy decisions about how to treat that person). That's not a bizarro argument to make, but it's not the same as arguing that in this case a remunerative incentive is also a coercive one. And it also points to the second reason that I've changed the example a bit and moved the original here to the talk page: because even if the example is precisified, it approaches or perhaps steps over the line into POV in favor of government welfare programs. Which is not to say that the debate over whether the risk of starvation from poverty is or is not enough like a threat of bodily violence to justify welfare policies couldn't belong on this page, but if it is to be on the page, it would have to be discussed as a debate, rather than having one position in the debate stated matter-of-factly in the course of an elucidatory example.

I hope that this had made some sense. Thanks for the work you've done on the article. Cheers!

Radgeek 19:36, 4 Jun 2004 (UTC)

Intro paragraph[edit]

I have clipped the following two sentences back out of the introductory paragraph:

It is a kind of motivation. Incentive can be of two types; Financial Incentive and Non-Financial Incentive.

It is not at all clear to me why they were added. Besides making the opening paragraph more difficult to read, they also restate information contained in the immediately preceding sentence (that incentives bear on motivation) and in the immediately following paragraph (that incentives can be either financial and non-financial). Further, it adds a conceptual confusions: incentives are not motivations but rather the objects of motivation. (If I'm working to make money, my incentive for work is the money, not the motivation to get money.)

If there is some reason that these sentences really need to be where they were added, please let me know. Radgeek 13:44, 21 Jun 2005 (UTC)

Corporate merger[edit]

The "positive aspects of incentives" and "negative aspects of incentives" sections have been merged into a single section discussing "Incentive Problems", focusing on the subject of unintended consequences.

As they had been written, the sections contained useful information but presented it at the cost of confusing the discussion. The "negative aspects" are not negative aspects of incentives (in the economic sense), but rather negative aspects of particular incentive structures -- specifically negative aspects that were not forseen by the people instituting those incentive structures. Any purposeful action whatsoever reflects some incentive structure, so describing these points as "positive" and "negative aspects of incentives" is rather like citing the fact that doctors and murderers each breathe it as "positive" and "negative aspects of oxygen."

Unintended consequences and other incentive problems are such a wide and important phenomenon in economics that they should indeed be discussed at the bottom of the article, but it should be done differently. In light of this I've tried merging the information in the two into a single discussion of the problem of unintended consequences. There's other stuff that could be discussed (such as the principal-agent problem) but that I haven't added in yet. I hope this helps the article progress! —Radgeek 14:31, 21 Jun 2005 (UTC)

Incentive plans[edit]

while i was looking for incentive plans . i was unable to find types of incentive plans you may include this into the article.

Types of incentive plans
Straight piece rate system
straight piece rate with guaranteed base wages
Diffrential piece ratesystem by FW Taylor
Hasley Plan
Rowan plan
Gantt Plan
Bedaux Plan
Emerson's Efficency plan
Group Incentive plan
Achalmeena 16:30, 5 February 2007 (UTC)

On a side-note, are these terms supposed to be ordered 1 to 7? If so, the auto-numbering may have gotten thrown off by the line break in there. --PURCDirector MarkJamison 15:29, 24 February 2009 (UTC) —Preceding unsigned comment added by PURCDirector MarkJamison (talkcontribs)

"Citation needed" on humans being purposeful creatures[edit]

About the "citation needed" added (improperly) by on 10 December 2008, re: humans being purposeful creatures...I, for one, don't think that citation *is* needed, and I'm kind of surprised this has been allowed to remain, given that has:

Maybe I'm missing something (which is why I'm posting here, instead of just removing it), but I don't understand why it's been allowed to remain. Anyone else want to weigh in on this, or should I just undo this nonsense? -- Pegasus Epsilon (talk) 10:03, 2 January 2009 (UTC)

It's been 12 days, and nobody's bothered responding. Either nobody cares, or everyone agrees, so I've removed it. Pegasus Epsilon (talk) 16:45, 14 January 2009 (UTC)
Is the statement "humans are purposeful creatures" axiomatic, tautological, or deducible? No, it's not. Evidence must be provided to show that humans are purposeful creatures, that is not something you can just assume to be true. Any human action could just as easily be considered a deterministic effect of a causal recursion. [1] (talk) 17:29, 11 December 2012 (UTC)


a benefit often used by large companies to attract workers and keep them happy. —Preceding unsigned comment added by (talk) 02:53, 8 January 2010 (UTC)

...I realy admire the topic and its article content. I'm going to use my expertize in some of writings. It will of course deal with tax incentives, in a fair economy. Well done!; keep up the good workDavid George DeLancey (talk) 14:38, 11 April 2011 (UTC)

Cognitive evaluation theory[edit]

I added cognitive evaluation theory to the See Also section, and I want to make sure the reason for it is clear before someone deletes it as irrelevant. Briefly, CET explains how different types of incentives affect motivation for a given behavior, and is supported by close to 40 years of empirical research. From what I can tell, the See Also should only have links, not comments about those links, which is why I'm putting this explanation here instead. If anyone wants to make this clearer on the article page, however, that's fine with me. psychojosh13 (talk) — Preceding unsigned comment added by (talk) 14:46, 23 April 2012 (UTC)

-- (talk) 19:58, 24 September 2012 (UTC)-- (talk) 19:58, 24 September 2012 (UTC)-- (talk) 19:58, 24 September 2012 (UTC)-- (talk) 19:58, 24 September 2012 (UTC)-- (talk) 19:58, 24 September 2012 (UTC)-- (talk) 19:58, 24 September 2012 (UTC) kjwkmpmn

Dr. Villeval's comment on this article[edit]

Dr. Villeval has reviewed this Wikipedia page, and provided us with the following comments to improve its quality:

The economic analysis of incentives is relatively poorly developed. The principal-agent theory should be presented as the theoretical framework that rationalize the design of optimal incentives to motivate agents in the presence of asymmetric information.

The hold-up problem could be introduced. The dynamic aspect of incentives and the ratchet effect should also be mentioned.

Incentives do not only increase motivation, they also contribute to the self-selection of individuals, as different people are attracted by different incentive schemes depending on thei attitudes towards risk, uncertainty, competitiveness.

The article could also refer to the opposite crowding-out theory of incentives: the introduction of monetary incentives can crowd-out intrinsic motivation.

Regarding the empirical analysis of incentives, many experimental studies have been developed that help understanding how incentives affect motivation.

Important references are missing, such as:

(1993). A theory of incentives in procurement and regulation - ‎Laffont J.J., Tirole, J.

Akerlof, G. (1970). The Market for ‘Lemons’: quality uncertainty and the market mechanism. Quarterly Journal of Economics, 84, 488–500.

Chiappori, P. A., & Salanié, B. (2003). Testing contract theory: a survey of some recent work. In M. Dewatripont, L. Hansen, & S. Turnovsky (Eds.), Advances in economics and econometrics: Vol. 1 Cambridge: Cambridge University Press.

Kanemoto, Y., & MacLeod, B. W. (1992). The ratchet effect and the market for secondhand workers. Journal of Labor Economics, 10(1), 85–98.

Milgrom, P., & Roberts, J. (1992). Economics, organization and management. Englewood Cliffs: Prentice Hall.

Prendergast, C. (1999). The provision of incentives in firms. Journal of Economic Literature, 37, 7–63.

Cooper, David J., John H. Kagel, Wei Lo and Qing Liang Gu (1999), “Gaming Against Managers in Incentive Systems: Experimental Results with Chinese Students and Chinese Managers” American Economic Review 89(4), (Sept): 781-804.

Laffont, Jean-Jacques, and Jean Tirole (1988), “The Dynamics of Incentive Contracts” Econometrica, 56: 1153-75.

Lazear, Edward (1998), Personnel Economics for Managers. New York: Wiley.

We hope Wikipedians on this talk page can take advantage of these comments and improve the quality of the article accordingly.

Dr. Villeval has published scholarly research which seems to be relevant to this Wikipedia article:

  • Reference : Robin M. Hogarth & Marie Claire Villeval, 2014. "Ambiguous Incentives and the Persistence of Effort : Experimental Evidence," Working Papers 1432, Groupe d'Analyse et de Theorie Economique (GATE), Centre national de la recherche scientifique (CNRS), Universite Lyon 2, Ecole Normale Superieure.

ExpertIdeas (talk) 19:42, 26 August 2015 (UTC)

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