Stéphane Luchini, from Centre National de la Recherche Scientifique (CNRS)  and Aix-Marseille School of Economics (AMSE), will present "Rethinking Effort: Insights from Neuroscience and Economics"

Abstract: Effort has been a key concept in economics at least since Harvey Leibenstein’s observation in the 1950s that paying workers in “backward economies” higher-than-market wages (which were otherwise extremely low) would enable them to afford better nutrition, increasing their strength and energy and ultimately leading them to work harder. This idea laid the foundation for the now well-known concept of efficiency wages—the notion that paying wages above the equilibrium level induces greater effort. Over time, the discussion shifted from an energy-based account to a motivational one: higher wages provide stronger incentives, leading workers to exert greater effort. At the same time, effort is seen as costly and therefore something people tend to avoid. This idea dates back at least to Adam Smith, who described the “toil and trouble” that labourers endure while working. Contemporary information economics has integrated this idea with the assumption of imperfect information: economists recognize that effort itself is unobservable and therefore rely on performance outcomes as a proxy, assuming that greater effort leads to better performance. Since effort cannot be directly measured, labour contracts must account for two key factors: (1) performance is an imperfect measure of effort, and (2) workers tend to avoid exerting high effort due to its cost, while employers want them to do exactly that. Consequently, incentive structures are necessary to align these diverging interests as effective as possible. Much of economic theory ultimately hinges on a concept—effort—that remains unobservable and poorly understood. That effort is costly to employers is clear, as they must pay wages or offer incentives to elicit it. But is effort always and under all conditions “costly” to employees, workers, or entrepreneurs? And what does engaging in effort, particularly cognitive effort, actually entail? Neurosciences and neuroeconomics appear to be a promising field for deepening our understanding of what effort really is. However, upon closer examination, contemporary neuroeconomic research (e.g., Kurzban et al., 2013; Westbrook et al., 2015) largely adopts the economic cost-benefit framework. Neuroscientists assume, much like economists, that effort is costly and that people tend to avoid it, conforming to what is often called the law of least effort. They conceptualize effort as an aversive and unpleasant experience, making it inherently costly. From this perspective, effort has negative valence—people try to avoid it unless a reward offsets the cost. Furthermore, the opportunity cost framework suggests that effort is costly because cognitive resources are limited: since we cannot use our cognitive processes for multiple tasks simultaneously, we must prioritize. Increased aversiveness or unpleasantness signals higher opportunity cost, implying that our cognitive resources might be better allocated to other, more rewarding tasks. Neuroscientists measure effort in terms of subjective effort valuation—the amount of reward (typically money in experimental settings) a person requires to feel indifferent between a low effort, low-reward task and a high-effort, high-reward task (Westbrook et al., 2013). In this framework, the cost of effort is quantified as the difference in reward necessary to make the two options equally desirable. However, this negative-valence view of effort encounters a well-documented issue known as the effort paradox (Inzlicht et al., 2018): if effort is costly, why do people voluntarily engage in effortful activities, such as playing chess or raising children? To resolve this paradox, neuroscientists— much like economists—often introduce ad hoc benefits that effort may confer, which modify the overall cost-benefit calculation (Inzlicht et al., 2018). An alternative perspective on effort can be found in earlier psychological research, including Daniel Kahneman’s work (1973). This view conceptualizes effort as the intensity of voluntary attention directed toward tasks chosen based on one’s plans and intentions. Crucially, effort in this framework is linked to physiological arousal, as evidenced by changes in pupil size, heart rate, and skin conductance. More difficult tasks demand greater effort and are associated with increased arousal, making effort objectively measurable through physiological markers. This arousal perspective provides a broader understanding of effort. Unlike the valence perspective, it does not assume that people engage in effortful activities solely for rewards. Instead, effortful engagement can stem from various motivations, thereby resolving the effort paradox without resorting to additional reward mechanisms. The only cost in this view is a performance-related cost: because attentional capacity is limited, we must allocate effort selectively. More difficult tasks require greater effort, meaning that insufficient effort will lead to poor performance. However, too much effort can also impair performance—a concept captured by the Yerkes-Dodson law (1908), which states that both low arousal and excessive arousal are detrimental to performance. To empirically test which perspective—valence or arousal—better reflects how people experience effort, we designed an experimental paradigm. Given our economic background, we might expect that people perceive cognitive effort as having negative valence, meaning they would find it costly and unpleasant. Participants completed a cognitively demanding memory task, the n-back task, which varies in difficulty. We recorded physiological markers of arousal, such as pupil dilation, and collected self reports on perceived effort, arousal, and valence. Our results indicate that participants did not associate negative valence with effort; moreover, as task difficulty increased, valence remained unchanged. In other words, more difficult tasks were not experienced as more aversive or costly. However, self-reported effort correlated strongly with both self-reported arousal and pupil dilation. More difficult tasks led to greater arousal and were perceived as more effortful. These preliminary findings lend support to the arousal perspective of effort. Further research is necessary to develop a more comprehensive understanding of this non-economic view of effort. If confirmed, these findings would challenge key economic assumptions about effort and open new avenues for investigating the implications of unpacking the black box of effort.