Self-set salaries and creativity

  • Organizations frequently try to incentivize employees to develop highly creative solutions. In this study, we examine self-set salaries as a specific type of incentive design. We investigate whether self-set salaries affect employees’ motivation and overall (creative) performance. Moreover, because self-set salaries potentially risk opportunistic employee behavior, we consider the effect of the observability of peer performance on employees’ level of self-set salaries. Using a laboratory experiment, we hold the average employee compensation constant and demonstrate that, in comparison with fixed-pay contracts, self-set salaries increase the quantitative performance in creative tasks without affecting the average creativity. However, we do not find significant differences between the amount of individuals’ self-set salaries with observability of peer performance and the amount for individuals without the chance to observe peer performance. Our findings are important for firms that rely on the development of creative ideas but areOrganizations frequently try to incentivize employees to develop highly creative solutions. In this study, we examine self-set salaries as a specific type of incentive design. We investigate whether self-set salaries affect employees’ motivation and overall (creative) performance. Moreover, because self-set salaries potentially risk opportunistic employee behavior, we consider the effect of the observability of peer performance on employees’ level of self-set salaries. Using a laboratory experiment, we hold the average employee compensation constant and demonstrate that, in comparison with fixed-pay contracts, self-set salaries increase the quantitative performance in creative tasks without affecting the average creativity. However, we do not find significant differences between the amount of individuals’ self-set salaries with observability of peer performance and the amount for individuals without the chance to observe peer performance. Our findings are important for firms that rely on the development of creative ideas but are unsure about the effects of the introduction of self-set salariesshow moreshow less
Metadaten
Author details:Christian BrückORCiD, Thorsten KnauerORCiD, Harald Meier, Anja SchweringORCiDGND
DOI:https://doi.org/10.1007/s11573-020-00985-z
ISSN:1861-8928
ISSN:0171-9130
Title of parent work (English):Journal of Business Economics
Publisher:Springer
Place of publishing:Berlin
Publication type:Article
Language:English
Date of first publication:2020/05/06
Publication year:2021
Release date:2022/09/22
Volume:91
Issue:1
First page:91
Last Page:121
Organizational units:Wirtschafts- und Sozialwissenschaftliche Fakultät / Wirtschaftswissenschaften / Fachgruppe Betriebswirtschaftslehre
DDC classification:3 Sozialwissenschaften / 33 Wirtschaft / 330 Wirtschaft
License (German):License LogoCC-BY - Namensnennung 4.0 International
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