Role of Reference Thinking on Distance- or Time-based Compensation of Online Meal Delivery Agents

This study applies prospect theory, referent thinking and the psychological impact of reference thinking through an analytical framework and two field experiments to examine delivery agents’ willingness to participate in or accept an online meal delivery service under travel-distance- and time-based compensation schemes. The first study examined a field experiment in which scenarios involving labour effort and compensation either positively or negatively deviated from the reference point. On the contrary, the second study investigated the impact of deviations from the reference point on compensation and labour effort. The results indicate that relative thinking holds (or deviates) when compensation diverges from reference compensation based on labour effort. The relative-thinking effect remains consistent when compensation aligns with expectations, returns to its initial state when it deviates slightly and resurfaces when it deviates significantly.