Scientific Definition
Reward systems slowly diverge from the outcomes they were meant to drive.
Plain-English Definition
Reward systems slowly diverge from the outcomes they were meant to drive.
Feynman Explanation
Today's KPI is tomorrow's perverse incentive in a suit.
Core Principle
Reward systems slowly diverge from the outcomes they were meant to drive.
Mechanisms
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Inputs (Triggers)
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Outputs (Behaviors)
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Behavioral Signature
Today's KPI is tomorrow's perverse incentive in a suit.
Examples
- Sales comp plans that once drove growth now reward end-of-quarter discounting.
- Most strategy decay is unmeasured incentive drift.
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Famous Experiments
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Design Principles
- Re-baseline incentives against outcomes every 6–12 months.
Measurement Approaches
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Evidence
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The Perverse Incentive Lens™
How this behavior is exploited — and how to redesign around it.
- Re-baseline incentives against outcomes every 6–12 months.
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Interactive Mini Network
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Knowledge Graph Neighbors
Auto-linked to the rest of the Human Behavior Taxonomy by family, domain, dimension, and shared keywords.
Inability to see the incentives shaping one's own behavior.
Accumulated workarounds for misaligned incentives that compound like technical debt.
Without active design, incentives decay toward gameable proxies.
Behavior bends toward whatever the system actually rewards.
Treating the measure as the goal it was meant to approximate.
Clear ownership of outcomes, not just tasks.
Asymmetric information attracts the worst counterparties.
We defer to perceived expertise, rank, or uniform.
Vastness that exceeds existing schemas dissolves the self briefly.
Negative feedback returns a system toward a target.
Membership in a group is a baseline human need.
Individually rational choices that produce a collectively bad outcome.