The Psychology Behind Incentives with Uri Gneezy
In this episode, my guest Uri Gneezy joins me to talk about the psychology behind creating and using incentives.
Uri Gneezy is the Epstein/Atkinson Endowed Chair in Behavioral Economics and professor at the Rady School of Management at the University of California, San Diego. He received his B.A. in economics at Tel Aviv University and Ph.D. in economics at Tilburg University. Gneezy joined UC San Diego in 2006. Prior to that, he was a professor at the University of Chicago, the Technion and the University of Haifa. He was a visiting scholar at the University of Amsterdam, NHH Bergen and Burgundy School of Business.
As a researcher, Gneezy focuses on putting behavioral economics to work in the real world, where theory can meet application. He is looking for basic research as well as more applied approaches to the study of when and why incentives (don’t) work. His research covers topics such as incentives-based interventions to increase good habits and decrease bad ones, gender differences in reaction to incentives, and how incentives affect deception and ethical behavior in general. In addition to the traditional laboratory and field studies, he is working with firms on using basic findings from behavioral economics to help companies achieve their traditional goals in non-traditional ways.
Gneezy’s research includes over 100 peer-reviewed journal articles, for which he won the Most Highly Cited Researcher prize for the last 8 years. He is a coauthor (with John List) of the international best seller The Why Axis: Hidden Motives and the Undiscovered Economics of Everyday Life and author of Mixed Signals: How Incentives Really Work.
We talk about:
- [0:00] Intro
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[3:25] What inspired Uri to write ‘Mixed Signals’
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[4:05] Examples of ‘mixed signals’ when it comes to incentives
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[6:40] Why humans are influenced by social norms and signaling
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[10:10] Specific industries where incentives work best
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[11:20] Loyalty programs as brand incentives
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[12:45] How to design a loyalty program
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[15:45] Pitfalls and misconceptions when implementing incentive programs
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[20:05] Positive and negative incentives
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[23:05] How each gender perceives and reacts to incentives
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[27:15] How to learn more about behavioral economics
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[33:20] One piece of advice for entrepreneurs
Connect with Uri here:
- https://www.twitter.com/urigneezy
- https://rady.ucsd.edu/faculty-research/faculty/uri-gneezy.html
Connect with Kaye here:
