Does money boost motivation when teams have to solve complex problems? Researchers from universities in Ulm, Munich and Tilburg have investigated this in a large-scale field study. They observed over 1000 teams in escape rooms, who had to solve tricky puzzles under time pressure and work together in an innovative and solution-orientated way. Their analysis shows that monetary incentives significantly reinforce team performance without strongly impairing intrinsic motivation, and that they can have a positive influence on team organisation. The study was published in the prestigious Journal of Political Economy.
The clock is ticking. The four-person team is just a few steps away from cracking the last code and getting out of the escape room. If the group is particularly quick, a team bonus of 50 euros beckons as a reward. But can financial incentives actually help teams to work together more efficiently on complex tasks? Researchers from Ulm University, the Ludwig Maximilian University Munich and Tilburg University in the Netherlands have investigated precisely this in a large-scale study. It is based on findings from field experiments with more than 5000 participants (over 1000 teams), conducted in real escape rooms. In this popular leisure and team-building activity, groups face a difficult challenge. Within a given time, they have to solve complex, analytical tasks in order to escape from a locked room. The scientists' findings have been published in the Journal of Political Economy.
The study makes particular use of the fact that escape rooms not only involve solving complex tasks, but that the team's performance can also be objectively compared - in the form of the time it takes to escape from the room. And the results are promising: the probability of solving the task within an ambitious time limit of 45 minutes doubled for teams that were promised a bonus for such a performance. These teams also solved the task significantly faster. "Our research shows that monetary incentives are also effective in complex, cognitively demanding and interactive tasks without substantially impairing intrinsic motivation," says Professor Simeon Schudy from the Institute of Economics at Ulm University.
"As previous research has mainly focused on the effect of incentives in routine tasks, our work provides important new insights for the design of incentive systems in modern work environments, which are increasingly characterised by non-routine team tasks." The study also showed that financial incentives influenced team organisation and reinforced the need for leadership within teams. An accompanying additional study also showed that when teams were randomly encouraged to appoint a leader, this also had a positive effect on team performance.
"Our results are important for the research fields of labour market and organisational economics, but certainly also for business practice," says Professor Schudy. "They show that bonus incentives can be a useful measure to promote team performance in complex and analytical work areas and highlight the important role of leadership and good team organisation."
The study was funded by the German Research Foundation and the Dutch Research Council.
Publication reference:
Florian Englmaier, Stefan Grimm, Dominik Grothe, David Schindler, and Simeon Schudy: The Effect of Incentives in Nonroutine Analytical Team Tasks. In: Journal of Political Economy, Volume 132, Number 8, August 2024
https://doi.org/10.1086/729443
Further information:
Prof. Dr. Simeon Schudy, Department of Economics, Mail: simeon.schudy(at)uni-ulm.de
Text and media contact: Christine Liebhardt