Abstract

We analyse how human resource managers and directors in German companies can become aware of the application of incentive systems like goalsetting and performance-based pay. In particular, we analyse to what extent a nudge can increase the interest of experts in goalsetting and performance-based pay. The nudge consists of giving information concerning the diffusion rate of goalsetting and performance-based pay, as well as the potential productivity increase. In fact, surveyed HR managers who received the information reported a higher interest in goalsetting and performance-based pay compared to the control group of HR managers without such information. Furthermore, the study showed a consistent answering behaviour between statements about intended activities with the performance management and statements about the actual implementation one year later.

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