A longitudinal experiment examined the influence of a lottery of gift certificates on response and retention in a four-wave study conducted in an online panel. Independent of the lottery, people who responded in a given wave were more likely to respond in the next wave. This process was characterized to follow a first-order Markov chain. There was a direct positive effect of the lottery on response only at the first wave of the study. However, mediated by the Markov process, the positive effect of the lottery on response at the first wave was carried over into later waves. The lottery did not have any effect on retention. Furthermore, it was found that retention at a given wave is a reliable predictor for response at the next wave. This information could be used by survey managers to diagnose and act on any impending nonresponse.
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