2018
Working Paper
HBS Working Paper Series

Who Is More Useful? The Impact of Performance Incentives on Work and Personal Relationships

By: Ashley V. Whillans, Alice Lee-Yoon and Julia Hur

Format:Print
| Language:English
| Pages:59

Abstract

Employees today report being too busy to talk to their friends and family, even though the number of hours they work has remained relatively constant over the last five decades. We highlight incentive systems as one underappreciated factor contributing to this phenomenon and explore the role of incentives in shaping how employees think about their different social relationships. Results from one archival dataset, one panel survey, and two experiments (n = 132,139) show that when employees are paid for performance, they prioritize spending time socializing with work colleagues at the sacrifice of spending time with friends and family. We further document goal instrumentality as a mechanism for these results: employees who receive performance incentives perceive their work ties as highly instrumental in achieving their goals. These findings provide the first empirical evidence that incentives shape employees’ social interactions within and outside of work, potentially providing a novel explanation for the dissolution of familial and personal ties in many developed countries.

Keywords

Performance Incentives; Work-family Boundary Management; Instrumentality; Lonelines; Employees; Performance; Motivation and Incentives; Work-Life Balance; Emotions

Citation

Whillans, Ashley V., Alice Lee-Yoon, and Julia Hur. "Who Is More Useful? The Impact of Performance Incentives on Work and Personal Relationships." Harvard Business School Working Paper, No. 19-050, October 2018. (Revised December 2018, Shared Authorship.)