Mixed Signals: How Incentives Really Work

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Mixed Signals: How Incentives Really Work
An informative and entertaining account of how incentives send signals that shape behaviors and how we can design better rewards for better results

Incentives send powerful signals that aim to influence behavior. But often there is a conflict between what we say and what we do in the presence of incentives. The result: mixed signals.

Consider the CEO who urges teamwork but designs incentives for individual success, who invites innovation but punishes failure, who emphasizes quality but pays for quantity. Employing real-world scenarios just like this to illustrate this everyday phenomenon, behavioral economist Uri Gneezy demonstrates how the right incentives can change behavior by aligning with signals for better results.

Drawing on behavioral economics, game theory, psychology, and fieldwork, Gneezy outlines how to be incentive smart, designing rewards that are simple, effective, and ethical. He highlights how the right combination of economic and psychological incentives can encourage people to drive more fuel-efficient cars, be more innovative at work, even help save endangered species. "Incentives send a signal," Gneezy writes, "and your objective is to make sure this signal is aligned with your goals."

Publication Date: 
March 21, 2023