So what happens? They do the tests.

He was wrong.

It's certainly the people you work with.

But the revenues are much greater if the drug treats a million people.

I think that'll be clear to you in a second.

High performance, about two month's salary.

Estimate one's creativity, increase it, and give an incentive for it

You know, economists like to say, there are no bad people, there are just bad incentives.

So, creativity counts, knowledge matters, innovations transform, incentives inspire.

So let's just say for a second and I want you to think about it what is everyone's incentive?

Same deal. You we're timing for norms.

Because sometimes this can get confusing.

But this is a problem of just incentives, just incentives.

The mid 1990s, Microsoft started an encyclopedia called Encarta.

So they have a very, very high rating.

When you try to solve really complex social problems, the right thing to do is most of the time to create the incentives.

Right? Bonuses, commissions, their own reality show.

In America 'rebate' is widely recognized, generally as an incentive where makers give back directly to consumers.

Again, a lot of people cheated by just by a little bit, and they were insensitive to these economic incentives.

People are willing to invest more, and the budgets are larger.

There are a lot of people who have a financial incentive to promote that story.

So it has neither the resources, nor the incentives, to hook up many other users.

And that means an increase incentive to do research and development, which benefits everyone in the world.

To maximize revenue. And why? Revenue to the artists?

And that is a way that you can make sure that your incentives are always aligned to use the new language.

Well, if something is inconvenient, even if we believe in it, moral suasion, financial incentives, don't do much to move us but social pressure, that's powerful stuff.

And it actually took being a journalist to understand all these incentives.

We don't have any incentive to go and resolve it across the U.S.

The bakery was completely wiped out, but the lessons for me were that accountability counts got to build things with people on the ground, using business models where, as Steven Levitt would say, the incentives matter.

Because there are more drugs to treat common diseases than there are to treat rare diseases.

And higher oil prices mean a greater incentive to invest in energy R amp D.

This time, the incentivized group kicked the other group's butt.

But it could be very different, because having access to those state backed facilities could incentivize this consortium to seriously invest in the service.

Last month, just last month, economists at LSE looked at 51 studies of pay for performance plans, inside of companies.

They gave them these challenges and they said, to incentivize their performance, they gave them three levels of rewards.

You've got an incentive designed to sharpen thinking and accelerate creativity, and it does just the opposite.

How to increase one's creativity and how to recruit and reward creative people

In eight of the nine tasks we examined across three experiments, higher incentives led to worse performance.

And whenever you're getting paid to give a rating, you have to wonder about what your incentives are, in terms of how you rate things.

We are reaching the state A4, gives us plus 100, minus 100 for B4, and perhaps minus 3 for every other state, which reflects the fact that if you take a step somewhere that we will pay minus 3.

We now recognize that getting markets right is about not just price incentives, but also investing in the right infrastructure and the appropriate and necessary institutions to create the conditions to unleash the power of innovation in the market.

Well if larger markets increase the incentive to produce new ideas, how do we maximize that incentive?

It did not take long after the rise of the commercial printing press before someone figured out that erotic novels were a good idea.

So the incentives for the people helping to construct this zone and build it, and set up the basic rules, go very much in the right direction.

They should discuss this innovation agenda, and you'd be stunned at the ridiculously low levels of spending on these innovative approaches.