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Instrument Choice and Motivation: Evidence from a Climate Change Experiment

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  • Timo Goeschl
  • Grischa Perino

    ()

Abstract

Are prices or quantities the best regulatory instrument to align private actions with public interests in the presence of externalities? We add another dimension to this ongoing debate by experimentally analyzing the interaction between instrument choice and intrinsic motivation of regulated agents. The response of subjects facing a trade-off between real CO2 emissions and private monetary payoffs to both a price and a quantity instrument are tested. We find evidence that taxes crowd out intrinsic motivation while emission standards are neutral. Crowding is short term persistent and not well explained by established cognitive theories of motivational crowding.

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Bibliographic Info

Article provided by European Association of Environmental and Resource Economists in its journal Environmental and Resource Economics.

Volume (Year): 52 (2012)
Issue (Month): 2 (June)
Pages: 195-212

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Handle: RePEc:kap:enreec:v:52:y:2012:i:2:p:195-212

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Web page: http://www.springerlink.com/link.asp?id=100263

Related research

Keywords: Instrument choice; Motivation crowding; Externalities; H23; H41; Q58; C91;

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References

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Cited by:
  1. Joachim Fuenfgelt & Stefan Baumgaertner, 2012. "Regulation of morally responsible agents with motivation crowding," Working Paper Series in Economics 241, University of Lüneburg, Institute of Economics.
  2. Grischa Perino & Luca A. Panzone & Timothy Swanson, 2011. "Crowding-in, crowding-out and over-crowding: The interaction between price and quantity based instruments and intrinsic motivation," Working Paper series, University of East Anglia, Centre for Behavioural and Experimental Social Science (CBESS) 11-10, School of Economics, University of East Anglia, Norwich, UK..

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