An experimental test of gaming incentives

In recent years, many organizations have undertaken efforts to introduce gaming incentives in order to enhance employee effort and user engagement. However, these incentives are not well understood, and subsequently there is a dearth of systematically controlled empirical evidence on their effects, as well as their interaction with other forms of motivation. We present the first comprehensive test of gaming incentives using a real effort lab experiment with a standard lab task adapted to allow the inclusion of gaming incentives. We test the effect of these incentives under two types of extrinsic incentives, an unconditional wage, and a piece rate. In addition, we also measure subject task motivation and explore interaction with intrinsic (task based) incentives. We report three main findings: first, gaming incentives increase effort when extrinsic incentives to exert effort are weak. When extrinsic incentives are strong, gaming incentives have no additional impact on effort, showcasing diminishing returns to multiple forms of incentives. Finally, some forms of gaming incentives are successful in increasing effort among the least task motivated, a property that is similar to extrinsic incentives. Implications for organizations seeking to implement gaming incentives are discussed.