Team Incentive Study Based On The Tournament

Since the 1990s, many types of teamwork models have been replacing the traditional, individual working methods. So the incentive theories which are based on the individuals are not so effective in the practice of teamwork. Moreover, the internal Social Loafing and Free-riding problems which occur in teams make the team less efficient. Due to these factors, there needs to be an incentive theory that is suitable for the teamwork environment.My paper reviews the basic theories of teamwork and team incentive including the categories of the team and the main ways and means to motivate the team .This paper also analyzes the three major problems of Social Loafing, Free-riding, Ratchet Effects, and the inaccurate assessment of individual performance. This paper discusses the incentive mechanism of the Tournament which is suitable for motivating the team and summarizes the positive and negative aspects of the Tournament. As this paper points out: when individuals are under the tournament concept, a teammate may also be tempted to destroy the production of his competitors in order to improve the own relative position which will lead to vicious competition as well as lowering the team's output. The paper builds a team incentive model to discuss the Tournament theoretically and finds out that the gap between winner and loser's prize and the size of the teams will affect the level of motivation during the Tournament. The bigger the gap and the fewer the number of people on the team, the better the Tournament will motivate the teams. This paper discusses the three principal applications for the team Tournament--fair play, symmetric teams, and the cost. The team Tournament has the following functions: arousing the strong desire of the teams to win, overcoming the Free-riding and Social Loaf, incentive compatibility and monitoring the managers' moral hazard, and causing no Ratchet Effects. The end of this paper analyzes two negative factors: team collusion, and excessive incentives or a lack of motivation and how to prevent them from happening.