{"id":{"repo_id":"uiuc","oai_identifier":"oai:www.ideals.illinois.edu:2142/106451"},"canonical_url":"https://search.dev.ndltd.org/etd/uiuc/oai:www.ideals.illinois.edu:2142/106451","repository":{"repo_id":"uiuc","name":"University of Illinois - Urbana-Champaign","base_url":"https://www.ideals.illinois.edu/oai-pmh"},"display":{"title":"Dismissal threats and the efficacy of performance-based incentives","abstract":"Prior research finds that the threat of being fired is effective at motivating effort. In this study, I use three experiments to examine how the presence of a dismissal threat may affect the efficacy of other incentives used by firms. Using theory on contrast effects, I argue that the mere presence of a dismissal threat changes employees’ response to additional incentives such that performance-based incentives are less motivating in the presence of dismissal threats if those incentives are framed as penalties rather than bonuses. Specifically, when dismissal threats are present, I expect employees to anticipate less negative affect and exert less effort in response to penalties, but I do not expect employees to anticipate less positive affect and exert less effort in response to bonuses. I generally find support for the underlying theory: in all three experiments, the presence of dismissal threats leads to lower forecasted negative affect for penalties but leads to no change in forecasted positive affect for bonuses. In the third experiment, when the consequences of dismissal are significant and salient, I find support for my hypothesis such that the presence of dismissal threats leads to lower effort in response to penalties but does not lead to lower effort in response to bonuses. My results suggest that when dismissal threats are present and the consequences of dismissal are salient, performance-based incentives framed as penalties may not be more effective than those framed as bonuses, contrary to prior research on contract framing.","abstract_html":"Prior research finds that the threat of being fired is effective at motivating effort. In this study, I use three experiments to examine how the presence of a dismissal threat may affect the efficacy of other incentives used by firms. Using theory on contrast effects, I argue that the mere presence of a dismissal threat changes employees’ response to additional incentives such that performance-based incentives are less motivating in the presence of dismissal threats if those incentives are framed as penalties rather than bonuses. Specifically, when dismissal threats are present, I expect employees to anticipate less negative affect and exert less effort in response to penalties, but I do not expect employees to anticipate less positive affect and exert less effort in response to bonuses. I generally find support for the underlying theory: in all three experiments, the presence of dismissal threats leads to lower forecasted negative affect for penalties but leads to no change in forecasted positive affect for bonuses. In the third experiment, when the consequences of dismissal are significant and salient, I find support for my hypothesis such that the presence of dismissal threats leads to lower effort in response to penalties but does not lead to lower effort in response to bonuses. My results suggest that when dismissal threats are present and the consequences of dismissal are salient, performance-based incentives framed as penalties may not be more effective than those framed as bonuses, contrary to prior research on contract framing.","abstract_has_math":false,"creators":["Hudgins, Ryan Matthew"],"institution":"University of Illinois at Urbana-Champaign","degree_name":"Ph.D.","degree_level":"Dissertation","degree_discipline":"Accountancy","degree_department":null,"school":null,"contributors":["Chen, Clara","Williamson, Michael","Vargas, Patrick","Wright, William F"],"advisors":[],"committee_chairs":[],"committee_members":[],"year":2020,"date_issued":"2020-03-02T22:38:45Z","date_published":"2020-03-02T22:38:45Z","updated_at":"2026-07-22T22:24:47Z","subjects":["dismissal threats","bonus","penalty","contract framing","contrast effects"],"languages":["en"],"rights":["Copyright 2019 Ryan Hudgins"],"rights_urls":[],"identifier_entries":[]},"links":{"outbound_url":"http://hdl.handle.net/2142/106451","outbound_label":"Handle","outbound_source":"dc:identifier"},"metadata_groups":[{"id":"people","label":"People","entries":[{"key":"dc:contributor","label":"Contributor","values":["Chen, Clara","Williamson, Michael","Vargas, Patrick","Wright, William F"]},{"key":"dc:creator","label":"Author","values":["Hudgins, Ryan Matthew"]}]},{"id":"academic_context","label":"Academic Context","entries":[{"key":"dc:date","label":"Dc Date","values":["2020-03-02T22:38:45Z","2024-01-25T06:00:00Z","2019-11-22","2019-12"]},{"key":"dc:type","label":"Dc Type","values":["text"]},{"key":"thesis:degree_discipline","label":"Discipline","values":["Accountancy"]},{"key":"thesis:degree_level","label":"Degree Level","values":["Dissertation"]},{"key":"thesis:degree_name","label":"Degree Name","values":["Ph.D."]},{"key":"thesis:institution_name","label":"Thesis Institution Name","values":["University of Illinois at Urbana-Champaign"]}]},{"id":"subjects_keywords","label":"Subjects and Keywords","entries":[{"key":"dc:subject","label":"Dc Subject","values":["dismissal threats","bonus","penalty","contract framing","contrast effects"]}]},{"id":"language_rights","label":"Language and Rights","entries":[{"key":"dc:language","label":"Dc Language","values":["en"]},{"key":"dc:rights","label":"Dc Rights","values":["Copyright 2019 Ryan Hudgins"]}]},{"id":"identifiers","label":"Identifiers","entries":[{"key":"dc:identifier","label":"Identifier","values":["http://hdl.handle.net/2142/106451"]}]},{"id":"additional","label":"Additional Metadata","entries":[{"key":"dc:description","label":"Description","values":["Prior research finds that the threat of being fired is effective at motivating effort. In this study, I use three experiments to examine how the presence of a dismissal threat may affect the efficacy of other incentives used by firms. Using theory on contrast effects, I argue that the mere presence of a dismissal threat changes employees’ response to additional incentives such that performance-based incentives are less motivating in the presence of dismissal threats if those incentives are framed as penalties rather than bonuses. Specifically, when dismissal threats are present, I expect employees to anticipate less negative affect and exert less effort in response to penalties, but I do not expect employees to anticipate less positive affect and exert less effort in response to bonuses. I generally find support for the underlying theory: in all three experiments, the presence of dismissal threats leads to lower forecasted negative affect for penalties but leads to no change in forecasted positive affect for bonuses. In the third experiment, when the consequences of dismissal are significant and salient, I find support for my hypothesis such that the presence of dismissal threats leads to lower effort in response to penalties but does not lead to lower effort in response to bonuses. My results suggest that when dismissal threats are present and the consequences of dismissal are salient, performance-based incentives framed as penalties may not be more effective than those framed as bonuses, contrary to prior research on contract framing.","Submission published under a 24 month embargo labeled 'Closed Access', the embargo will last until 2021-12-01","The student, Ryan Hudgins, accepted the attached license on 2019-11-21 at 15:03.","The student, Ryan Hudgins, submitted this Dissertation for approval on 2019-11-21 at 15:16.","This Dissertation was approved for publication on 2019-11-22 at 14:05.","DSpace SAF Submission Ingestion Package generated from Vireo submission #14582 on 2020-02-28 at 17:36:37","Made available in DSpace on 2020-03-02T22:38:45Z (GMT). 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In this study, I use three experiments to examine how the presence of a dismissal threat may affect the efficacy of other incentives used by firms. Using theory on contrast effects, I argue that the mere presence of a dismissal threat changes employees’ response to additional incentives such that performance-based incentives are less motivating in the presence of dismissal threats if those incentives are framed as penalties rather than bonuses. Specifically, when dismissal threats are present, I expect employees to anticipate less negative affect and exert less effort in response to penalties, but I do not expect employees to anticipate less positive affect and exert less effort in response to bonuses. I generally find support for the underlying theory: in all three experiments, the presence of dismissal threats leads to lower forecasted negative affect for penalties but leads to no change in forecasted positive affect for bonuses. In the third experiment, when the consequences of dismissal are significant and salient, I find support for my hypothesis such that the presence of dismissal threats leads to lower effort in response to penalties but does not lead to lower effort in response to bonuses. My results suggest that when dismissal threats are present and the consequences of dismissal are salient, performance-based incentives framed as penalties may not be more effective than those framed as bonuses, contrary to prior research on contract framing.","Submission published under a 24 month embargo labeled 'Closed Access', the embargo will last until 2021-12-01","The student, Ryan Hudgins, accepted the attached license on 2019-11-21 at 15:03.","The student, Ryan Hudgins, submitted this Dissertation for approval on 2019-11-21 at 15:16.","This Dissertation was approved for publication on 2019-11-22 at 14:05.","DSpace SAF Submission Ingestion Package generated from Vireo submission #14582 on 2020-02-28 at 17:36:37","Made available in DSpace on 2020-03-02T22:38:45Z (GMT). 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