The Price of a Price: On the Crowding out of Social Norms
AbstractThere is increasing empirical and experimental evidence thatproviding financial incentives to agents to performcertain socially desirable actions may permanently reduce other typesof motivations to undertake these actions.We study the impact of financial incentives on the desire for socialapproval, using the example of blood donation.We show that in a society with altruists and egoists, who all careabout social approval, introducing a payment intoa voluntary system may actually decrease the amount of blood donated.Withdrawing the financial incentive doesnot restore the norm to donate and may reduce the supply of bloodeven further.
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Bibliographic InfoPaper provided by Tinbergen Institute in its series Tinbergen Institute Discussion Papers with number 01-065/1.
Date of creation: 09 Jul 2001
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social norms; intrinsic and extrinsic motivation; network effects; health policy;
Find related papers by JEL classification:
- I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
- D10 - Microeconomics - - Household Behavior - - - General
- Z13 - Other Special Topics - - Cultural Economics - - - Economic Sociology; Economic Anthropology; Social and Economic Stratification
This paper has been announced in the following NEP Reports:
- NEP-ALL-2001-07-13 (All new papers)
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