Does feedback change what we know about incentives and creativity? A study on the impact of incentive type and individual performance feedback on creativity

Research on the effect of performance-dependent incentives on creativity has ignored the role of feedback and focused on one-round creativity production settings. A key finding from this research is that paying for quantity of output yields the same level of high-creativity output as other incentives but yields additional mediocre output (Kachelmeier et al. [2008]). This implies that quantity-only incentives are superior if mediocre output has utility. Feedback informs individuals about the success (or failure) of their prior task completion strategies, which allows them to change their task strategy. In a two-round laboratory experiment using a rebus puzzle task, we examine how individual performance feedback and performance-dependent incentives influence creativity and quantity of output. We find that after feedback, quantity-only and weighted (creativity and quantity) incentives result in more high-creativity output and a higher creativity rating for most creative output compared to fixed or creativity-only incentives. Supplemental analyses indicate that weighted incentives offer the benefit of a higher degree of congruence between participant strategy and actual output. Lastly, to our knowledge, this is the first study using the rigor of experimental economics to demonstrate that performance-dependent incentives can be used to increase the creativity of most creative output.