How incentive framing can harness the power of social norms

Incentives are an increasingly common tool used by organizations, managers, and policymakers to change behavior. We propose that more than just motivating behavior for monetary reasons, incentives also have an important, undiscovered consequence: they leak information about social norms. Four experiments reveal that framing an incentive as a surcharge, as compared to a discount, signals that the incentivized behavior is both more socially approved and more common. These implied norms lead individuals to experience emotions consistent with a desire to conform, motivating them to perform the incentivized behavior. Moreover, by shifting social norms, we find that incentives can influence behavior not only in the moment, but also downstream when there is no longer an active incentive. Further, merely being exposed to a surcharge (vs. discount) incentive—even without being financially affected by it—can increase performance of the behavior. These findings offer a novel perspective on the consequences of different incentive frames, while contributing to both organizational policy and practice by expanding the social norms messaging toolkit.