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Incentives and Prosocial Behavior

Roland Benabou () and Jean Tirole

No 1695, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: We develop a theory of prosocial behavior that combines heterogeneity in individual altruism and greed with concerns for social reputation or self-respect. Rewards or punishments (whether material or image-related) create doubt about the true motive for which good deeds are performed and this "overjustification effect" can induce a partial or even net crowding out of prosocial behavior by extrinsic incentives. We also identify settings that are conducive to multiple social norms and those where disclosing one's generosity may backfire. Finally, we analyze the choice by public and private sponsors of incentive levels, their degree of confidentiality and the publicity given to agents' behavior. Sponsor competition is shown to potentially reduce social welfare.

Keywords: identity; greed; overjustification effect; crowding out; esteem; motivation; altruism; morals; rewards; psychology; social norms (search for similar items in EconPapers)
JEL-codes: D64 D82 H41 Z13 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cbe, nep-evo, nep-exp, nep-ltv, nep-pbe and nep-soc
Date: 2005-07
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Citations: View citations in EconPapers (19) Track citations by RSS feed

Published in: American Economic Review, 2006, 96 (5), 1652-1678

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Journal Article: Incentives and Prosocial Behavior (2006) Downloads
Working Paper: Incentives and Prosocial Behavior (2006)
Working Paper: Incentives and Prosocial Behavior (2006) Downloads
Working Paper: Incentives and Prosocial Behavior (2005) Downloads
Working Paper: Incentives and Prosocial Behaviour (2004) Downloads
Working Paper: Incentives and Prosocial Behavior (2004) Downloads
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