In this study we examine whether increasing targets based on past performance information or on exogenous information affects employees' trade-off between short-term output and long-term investments differently. Both mechanism are supposed to increase long-term investments, while also achieving...

The practice of telecommuting has increased during recent years; however, the COVID-19 crisis has accelerated its development even further. Despite various opinions on telecommuting, many companies struggle to establish long-term telecommuting policies; additionally, causal evidence on its...

In this paper, we empirically examine the capital budgeting process of a large multi-divisional firm and the implications of the dynamics that underlie this process. Although investment decisions are one of the most important decisions made by firms, relatively little is known about the capital...

In this study I examine how sales channel selection influences the type of customers attracted to a service and how the different types of customers are associated with indirect costs that are not captured by traditional accounting systems. The choice of a sales channel to target customers is a...

In a laboratory experiment I investigate the role of perceived own ability in a multi-task setting with career concerns under fixed wages and under financial incentives with a higher weight on the task measured with noise. I find that in the absence of career concerns participants allocate...

Investment decisions are among the most important managerial decisions. The purpose of this study is to examine whether non-diagnostic information in investment decisions elicits a dilution effect such that decision outcomes deviate from a Net Present Value (NPV) assessment. We also answer the...

Cost overruns on multi-period projects are large and frequent in natural environments. Reasons for these overruns include cost understatements in initial project proposals and escalation of commitment to projects when initial actual costs turn out to be higher than expected. Prior literature has...

In two laboratory experiments, I investigate how supervisors' task performance in lower-level jobs prior to being promoted to supervisory levels influences the targets they set for employees. I propose that supervisors' own prior task performance can lead to an egocentric “experience bias”...

This study provides descriptive evidence on target setting policies in multi-divisional firms. Despite the importance of performance targets in practice, research mainly focuses on a few key areas in target setting, neglecting many other important aspects of target setting in organizations....