Behavioral and Brain Sciences



Short Communication

Varying the scale of financial incentives under real and hypothetical conditions


Charles A. Holt a1 and Susan K. Laury a2
a1 Department of Economics, University of Virginia, Charlottesville, VA 22903 [email protected] www.people.virginia.edu/~cah2k
a2 Department of Economics, Georgia State University, Atlanta, GA 30303-3083 [email protected] www.gsu.edu/~ecoskl

Abstract

The use of high hypothetical payoffs has been justified by the realism and relevance of large monetary consequences and by the impracticality of making high cash payments. We argue that subjects may not be able to imagine how they would behave in high payoff situations.



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