Altruism and Career Concerns
AbstractThe paper studies the impact of altruism on Agent’s motivation in the career concerns model. I show that career concerns incentive is lessened by altruism. As a consequence, altruism can decrease effort, though conventional wisdom suggests that effort should always be higher for the more altruistic worker. This means that not only intrinsic motivation can be crowded by extrinsic incentives; crowding effect can go in the opposite direction as well. This emphasizes a new channel of interaction between intrinsic and extrinsic motivation. The paper also studies the effect of altruism on wage. Interestingly, the model provides an example of winner’s blessing and shows that ambitions can hinder altruistic relationship. The model can be naturally applied to the workplace relationship and to the local public good provision.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by University of Gothenburg, Department of Economics in its series Working Papers in Economics with number 427.
Length: 40 pages
Date of creation: 22 Jan 2010
Date of revision:
Contact details of provider:
Postal: Department of Economics, School of Business, Economics and Law, University of Gothenburg, Box 640, SE 405 30 GÖTEBORG, Sweden
Phone: 031-773 10 00
Web page: http://www.handels.gu.se/econ/
More information through EDIRC
Extrinsic and intrinsic motivation; Career concerns; Altruism; Crowding-out;
Other versions of this item:
- D64 - Microeconomics - - Welfare Economics - - - Altruism; Philanthropy
- D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
- M52 - Business Administration and Business Economics; Marketing; Accounting - - Personnel Economics - - - Compensation and Compensation Methods and Their Effects
This paper has been announced in the following NEP Reports:
- NEP-ALL-2010-01-30 (All new papers)
- NEP-CBE-2010-01-30 (Cognitive & Behavioural Economics)
- NEP-SOC-2010-01-30 (Social Norms & Social Capital)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Rotemberg, Julio J, 1994. "Human Relations in the Workplace," Journal of Political Economy, University of Chicago Press, vol. 102(4), pages 684-717, August.
- Patrick Bolton & Mathias Dewatripont, 2005.
MIT Press Books,
The MIT Press,
edition 1, volume 1, number 0262025760, January.
- Bengt Holmstrom, 1999.
"Managerial Incentive Problems: A Dynamic Perspective,"
NBER Working Papers
6875, National Bureau of Economic Research, Inc.
- Holmstrom, Bengt, 1999. "Managerial Incentive Problems: A Dynamic Perspective," Review of Economic Studies, Wiley Blackwell, vol. 66(1), pages 169-82, January.
- Christian Grund & Dirk Sliwka, 2002.
"Envy and Compassion in Tournaments,"
Bonn Econ Discussion Papers
bgse32_2002, University of Bonn, Germany.
- Besley, Timothy J. & Ghatak, Maitreesh, 2004.
"Competition and Incentives with Motivated Agents,"
CEPR Discussion Papers
4641, C.E.P.R. Discussion Papers.
- Michael Kosfeld & Armin Falk, 2006.
"The Hidden Costs of Control,"
American Economic Review,
American Economic Association, vol. 96(5), pages 1611-1630, December.
- Dirk Sliwka, 2007.
"Trust as a Signal of a Social Norm and the Hidden Costs of Incentive Schemes,"
American Economic Review,
American Economic Association, vol. 97(3), pages 999-1012, June.
- Sliwka, Dirk, 2006. "Trust as a Signal of a Social Norm and the Hidden Costs of Incentive Schemes," IZA Discussion Papers 2293, Institute for the Study of Labor (IZA).
- Bartling, Björn & Siemens, Ferdinand von, 2006.
"The Intensity of Incentives in Firms and Markets: Moral Hazard with Envious Agents,"
Discussion Papers in Economics
913, University of Munich, Department of Economics.
- Bartling, Björn & von Siemens, Ferdinand A., 2010. "The intensity of incentives in firms and markets: Moral hazard with envious agents," Labour Economics, Elsevier, vol. 17(3), pages 598-607, June.
- Bartling, Björn & Siemens, Ferdinand von, 2006. "The Intensity of Incentives in Firms and Markets: Moral Hazard with Envious Agents," Discussion Paper Series of SFB/TR 15 Governance and the Efficiency of Economic Systems 115, Free University of Berlin, Humboldt University of Berlin, University of Bonn, University of Mannheim, University of Munich.
- Hideshi Itoh, 2004. "Moral Hazard and Other-Regarding Preferences," The Japanese Economic Review, Japanese Economic Association, vol. 55(1), pages 18-45.
- Amihai Glazer, 2008. "Optimal Contracts When a Worker Envies His Boss," Journal of Law, Economics and Organization, Oxford University Press, vol. 24(1), pages 120-137, May.
- Sliwka, Dirk, 2003.
"On the Hidden Costs of Incentive Schemes,"
IZA Discussion Papers
844, Institute for the Study of Labor (IZA).
- Robert Dur & Amihai Glazer, 2004. "Optimal Incentive Contracts when Workers envy their Boss," Tinbergen Institute Discussion Papers 04-046/1, Tinbergen Institute, revised 13 Jun 2006.
- Robert Dur & Jan Tichem, 2012.
"Social Relations and Relational Incentives,"
Tinbergen Institute Discussion Papers
12-054/1, Tinbergen Institute.
- Dur, Robert & Tichem, Jan, 2013. "Altruism and Relational Incentives in the Workplace," IZA Discussion Papers 7363, Institute for the Study of Labor (IZA).
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Marie Andersson).
If references are entirely missing, you can add them using this form.