user behavior - Karma Points vs Numeric Levels

I'm interested in creating a social network where users are rewarded for completing certain tasks. Obviously the concept in itself heavily favors that of gamification. I'm wavering between either tallying points or giving the user an actual level. So to put this into better perspective it comes between using a point based system like StackExchange or a level based one like Klout.

My question is are there facts that show users more inclined towards participating within a community if:

• There's a cap on the level they can reach, say level 99 being the max?


• A user has a high point tally does this achievement maintain a
  sense of value after the fact? In other words is there a difference
  between 20K vs 30K at that point?


• And lastly if either method is used does user participation dwindle once a high level is reached. Or does the opposite occur where it increases or stays the same?

Overall what reward system would be the best choice?

Answer

You should use points. Here's why:

1. If you're interested in gamification, then points will give the user immediate feedback, which is important. Gaining a level might take too long for the user to bother, but gaining points, even small amounts, works quickly, easily, and gives immediate positive feedback. With gaining levels, it might take too long to achieve that positive feedback.


2. Points naturally give rise to levels, but points are more precise. Here, on StackExchange, we use points, but we also have implicit levels -- just look at your privileges tab. When I look at users, I usually group them into "levels" according to their rep (e.g. I think of 100-500 rep as being one of these levels).


3. How would you assign levels? How would you decide what merits level 1,2,3,...,99? You don't really know how this will play out. The great thing about points is that they're a simple numerical scale, which the users will gradually group into their own "levels".

To answer your question in more detail: with regard to 'level caps': I don't know. Though it's important to note that once a user has already hit the practical maximum (on SE, for example, having 20K rep unlocks all privileges), then at that point the gamified points-system is usually either totally unimportant or very important to them: in either case, you're going to keep the user. (If getting more points is very important to them, then they'll obviously keep using the site. If getting more points is unimportant to them, then they're enjoying and using the site for its actual content at this point anyway, rather than just to get more points).