Intertemporal Choices: The Role of Feedback Frequency and Reward Timing

de Aguiar, Andson Braga; Oyadomari, José Carlos Tiomatsu; Zaro, Cláudio Soerger

doi:10.7819/rbgn.v21i2.3974

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Revista Brasileira de Gestão de Negócios

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Article • Rev. Bras. Gest. Neg. 21 (2) • Apr-Jun 2019 • https://doi.org/10.7819/rbgn.v21i2.3974 copy

Intertemporal Choices: The Role of Feedback Frequency and Reward Timing

Authorship Authorship Authorship SCIMAGO INSTITUTIONS RANKINGS

Abstract

Purpose

We examine whether managers allocate longer-term effort when they receive quarterly than either up to a month or longer than quarterly feedback. We also examine whether reward timing moderates the relationship between feedback frequency and intertemporal choices.

Design/methodology/approach

We collect survey data from 78 middle-level managers working at a Brazilian company.

Findings

The results indicate that managers place more weight on longer-term tasks when they receive quarterly feedback. Our results also indicate that reward timing moderates the relationship between feedback frequency and intertemporal choices.

Originality/value

The contribution of this study is twofold. First, we provide empirical evidence showing the effect of feedback frequency in a setting in which feedback is not mandatory, is provided for internal purposes, and there is no capital market pressure. Second, we disentangle these two components and offer empirical evidence on the relation between feedback frequency and intertemporal choices and on the moderate role of reward timing in this relationship.

Keywords
– Decision making; Feedback frequency; Reward timing; Intertemporal choice

Feedback Frequency (n = 78)	Percentages		Reward Timing (n = 78)	Percentages
Feedback Frequency (n = 78)	Relative	Cumulated	Reward Timing (n = 78)	Relative	Cumulated
Up to a month Quarterly Longer than quarterly	47.4 14.1 38.5	47.4 61.5 100.0	Up to three months Longer than three months	55.1 44.9	55.1 100.0
Total	100.0		Total	100.0	100.0

Intertemporal Choices (n = 78)	Average Frequency	Standard Deviation	Minimum	Maximum
Time spent on short-term tasks Time spent on medium-term tasks Time spent on long-term tasks	0.51 0.19 0.30	0.30 0.14 0.28	0.02 0.02 0.02	0.97 0.50 0.97

Variables (n = 78)	Long intertemporal choice	Feedback frequency	Reward timing	Financial measures	Decision strategy
Medium intertemporal choice	0.743^*** (0.000)	0.031 (0.789)	-0.152 (0.184)	-0.256** (0.023)	-0.990 (0.388)
Long intertemporal choice	-	0.054 (0.641)	-0.092 (0.423)	-0.235^** (0.038)	-0.144 (0.210)
Feedback frequency	-	-	-0.136 (0.236)	-0.119 (0.301)	0.024 (0.835)
Reward timing	-	-	-	-0.219^* * , ** Correlation is significant at the 0.10 and 0.05 levels, respectively (two-tailed tests). (0.054)	-0.067 (0.559)
Financial measures	-	-	-	-	0.041 (0.718)

Effect	Tests	Value	df—between groups	df—within groups	F	p-value
Model	W P L R	0.50 0.57 0.83 0.53	42 42 42 21	110 112 108 56	1.08 1.08 1.07 1.44	0.37 0.36 0.38 0.14
Feedback frequency	W P L R	0.87 0.13 0.14 0.14	4 4 4 2	110 112 108 56	1.92 1.89 1.94 3.90	0.06 ^* * , , * Effects are significant at the 0.10, 0.05 and 0.01 levels. W—Wilks’ lambda; L—Lawley-Hotelling trace; P—Pillai’s trace; R—Roy’s largest root. Bolded values are hypothesized directional relationships and, thus, one-tailed p-values. 0.06* 0.05* 0.01 ^***
Reward timing	W P L R	0.94 0.06 0.07 0.07	2 2 2 2	55 55 55 55	1.88 1.88 1.88 1.88	0.16 0.16 0.16 0.16
Feedback frequency * Reward timing	W P L R	0.85 0.15 0.17 0.14	4 4 4 2	110 112 108 56	2.24 2.24 2.25 3.99	0.07* 0.07* 0.07* 0.02^**
Financial measures	W P L R	0.61 0.43 0.55 0.32	30 30 30 15	110 112 108 56	1.01 1.03 1.00 1.20	0.46 0.44 0.48 0.30
Decision strategy	W P L R	0.96 0.04 0.04 0.04	2 2 2 2	55 55 55 55	1.19 1.19 1.19 1.19	0.31 0.31 0.31 0.31

Feedback frequency	N	Medium intertemporal choices				Long intertemporal choices
Feedback frequency	N	Mean	Std. Dev.	t	p-value	Mean	Std. Dev.	t	p-value
Up to a month x Quarterly	37 11	-0.53 -0.23	0.59 0.67	-1.34	0.10 ^*	-0.54 0.18	0.88 1.19	-1.87	0.04 ^**
Quarterly x Longer than quarterly	11 30	-0.23 -0.49	0.67 0.86	1.02	0.16	0.18 -0.44	1.19 1.04	1.54	0.07*
Up to a month x Longer than quarterly	37 30	-0.53 -0.49	0.59 0.86	-0.21	0.83	-0.54 -0.44	0.88 1.04	-0.40	0.69

Reward timing x up to a month feedback	N	Medium intertemporal choices				Long intertemporal choices
Reward timing x up to a month feedback	N	Mean	Std. Dev.	t	p-value	Mean	Std. Dev.	t	p-value
Short reward timing x Long reward timing	16 21	-0.39 -0.63	0.50 0.65	1.30	0.10^*	-0.54 -0.54	0.91 0.88	0.02	0.49
Reward timing x quarterly feedback	N	Medium intertemporal choices				Long intertemporal choices
Reward timing x quarterly feedback	N	Mean	Std. Dev.	t	p-value	Mean	Std. Dev.	t	p-value
Short reward timing x Long reward timing	10 1	-0.25 1.76	0.70 -	-	-	0.03 1.76	1.13 -	-	-
Reward timing x longer than quarterly feedback	N	Medium intertemporal choices				Long intertemporal choices
Reward timing x longer than quarterly feedback	N	Mean	Std. Dev.	t	p-value	Mean	Std. Dev.	t	p-value
Up to a month x Quarterly	17 13	-0.43 -0.56	0.86 0.88	0.41	0.34	-0.31 -0.61	1.08 1.00	0.78	0.22

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