nep-neu New Economics Papers
on Neuroeconomics
Issue of 2012‒12‒22
three papers chosen by
Daniel Houser
George Mason University

  1. How do Incentives affect Creativity? By Katharina Eckartz; Oliver Kirchkamp; Daniel Schunk
  2. Cognitive Mobility: Labor Market Responses to Supply Shocks in the Space of Ideas By George J. Borjas; Kirk B. Doran
  3. Ability Dispersion and Team Performance: A Field Experiment By Hoogendoorn, Sander M.; Parker, Simon C.; van Praag, Mirjam

  1. By: Katharina Eckartz (Friedrich-Schiller-University Jena, International Max Planck Research School on Adapting Behavior in a Fundamentally Uncertain World); Oliver Kirchkamp (Chair for Empirical and Experimental Economics, Friedrich-Schiller-University Jena); Daniel Schunk (University of Mainz)
    Abstract: We compare performance in a word based creativity task under three incentive schemes: a flat fee, a linear payment and a tournament. Furthermore, we also compare performance under two control tasks (Raven's advanced progressive matrices or a number-adding task) with the same treatments. In all tasks we find that incentives seem to have very small effects and that differences in performance are predominantly related to individual skills.
    Keywords: Creativity, Incentives, Real effort task, Experimental economics
    JEL: C91 J33
    Date: 2012–12–13
  2. By: George J. Borjas; Kirk B. Doran
    Abstract: Knowledge producers who are conducting research on a particular set of questions may respond to supply and demand shocks by shifting their resources to a different set of questions. Cognitive mobility measures the transition from one location in idea space to another location in that space. This paper examines the cognitive mobility flows unleashed by the influx of a large number of Soviet mathematicians into the United States after the collapse of the Soviet Union. Our analysis exploits the fact that the influx of Soviet mathematicians into the American mathematics community was larger in some fields than in others. The data reveal substantial cognitive mobility in response to the influx, with American mathematicians moving away from, rather than moving to, fields that likely received large numbers of Soviet émigrés. It appears that diminishing returns in specific research areas, rather than beneficial human capital spillovers, dominated the cognitive mobility decisions of pre-existing knowledge producers.
    JEL: J6 O31
    Date: 2012–12
  3. By: Hoogendoorn, Sander M. (University of Amsterdam); Parker, Simon C. (University of Western Ontario); van Praag, Mirjam (University of Amsterdam)
    Abstract: This paper studies the impact of diversity in cognitive ability among members of a team on their performance. We conduct a large field experiment in which teams start up and manage real companies under identical circumstances. Exogenous variation in – otherwise random – team composition is imposed by assigning individuals to teams based on their measured cognitive abilities. The setting is one of business management practices in the longer run where tasks are diverse and involve complex decision-making. We propose a model in which greater ability dispersion generates greater knowledge for a team, but also increases the costs of monitoring necessitated by moral hazard. Consistent with the predictions of our model, we find that team performance as measured in terms of sales, profits and profits per share first increases, and then decreases, with ability dispersion. Teams with a moderate degree of ability dispersion also experience fewer dismissals due to fewer shirking members in those teams.
    Keywords: ability dispersion, team performance, field experiment, entrepreneurship, knowledge pooling, moral hazard
    JEL: C93 D83 J24 L25 L26 M13 M54
    Date: 2012–11

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