Academic journal article The Psychological Record

Cross-Commodity Discounting of Monetary Outcomes and Access to Leisure Activities

Academic journal article The Psychological Record

Cross-Commodity Discounting of Monetary Outcomes and Access to Leisure Activities

Article excerpt

One of many tasks of an effective manager is to deliver reinforcers immediately following and contingent upon desired employee behaviors, which means managers should spend time among employees so they can directly observe behavior (Daniels, 1994). Organizations, though, are often replete with competing tasks and contingencies. One such set of competing contingencies present in modern workplaces involves the use of mobile phones. Recent estimates place smart phone ownership in America at 68 % of adults (Pew Research Center, 2015). A survey commissioned by an online recruitment service indicated that 50 % of U.S. employers surveyed cited mobile phone use as the most prevalent cause of lost workplace productivity, with 24 % of employees surveyed admitting to spending at least an hour per day on their phones and 21 % spending more than one hour browsing the internet for non-work-related reasons (CareerBuilder, 2014). The cumulative effect of lost work time can total a great deal of money for organizations, making this issue exigent. Some organizations have instituted an outright ban of mobile devices during work hours to address this issue. For example, many service-delivery settings prohibit access to one's mobile device during hours of service provision. FedEx also introduced an outright ban for their employees in recent years (Van Wyk, 2009). Although often effective, bans can lead to undesired outcomes such as reduction in employee morale and retention.

An alternative approach might be to incentivize better and more focused performance throughout the work day. Although managers and supervisors are responsible for monitoring employee performance, they also spend a great deal of time in their own offices, during which time they are not directly monitoring staff (Roberts & Geller, 1995). Thus, any reinforcement delivered by managers is likely far from being continuously available and may not align with an ideal reinforcement schedule. The published literature contains numerous examples of organizational incentive systems that deliver reinforcers weeks or months after employees exhibit desired behavior or meet a performance criterion (e.g., Luiselli et al., 2009). Understanding how schedules influence employee behavior allows organizations to leverage these effects rather than simply hope that whatever schedule happens to be in place is maintaining optimum levels of performance (e.g., Han tula, 2001).

The behavioral economic principle of discounting describes the systematic reduction in the subjective value of some outcome as a function of the delay to, or probability of, its receipt. Discounting has been applied to a variety of choice behaviors, such as substance abuse (Bickel et al., 2011), gambling (Holt, Green, & Myerson, 2003), saving for retirement (Laibson, 1997), and workplace risk-taking (Sigurdsson, Taylor, & Wirth, 2013). These issues can be thought of as a problem of overvaluing immediate and certain options while undervaluing delayed or uncertain options--that is, smaller, sooner outcomes exert more control over choice behaviors than larger, later outcomes. In the present context, an employee may overvalue having immediate and certain access to the various reinforcers available via mobile devices over the relatively uncertain and delayed consequences of reward for maintaining productivity.

A variety of mathematical models for discounting have been proposed, including an exponential decay function, a hyperbolic function (Mazur, 1997), and two variations of a hyperbola-like function (Myerson & Green, 1995; Rachlin, 2006). The latter three models have strong support in the literature and take the form

[V.sub.D] = A/*(1 x k[theta]) (1)

where [V.sub.D] is the subjective value of the delayed outcome, A is the objective amount, k is a constant that specifies the rate at which the value is discounted, and [theta] is the odds against receipt. The hyperbola-like models add an exponential parameter raising either [theta] or the entire denominator to a power (. …

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