Explaining the assigned goal-incentive interaction: The role of self-efficacy and personal goals

This study was designed to replicate conceptually and to explain the goal-level vs. incentive-type interaction reported by Mowen, Middlemist, and Luther (1981) based on goal setting and social cognitive theories. Mowen et al. found that subjects performed more poorly with hard goals than medium goals under a bonus pay system, the opposite of what was found for a piece-rate system. In the present study, an hourly pay condition was added. Mowen et al.'s interaction was replicated using a two-trial design in which subjects could obtain feedback about their ability to attain the incentive bonuses between trials. The experimental effects were completely mediated by personal goals and self-efficacy. Goal commitment was related to performance, but did not mediate the experimental conditions. The implications for the design of incentive systems are discussed.