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Will There Be Blood? Incentives and Substitution Effects in Pro-social Behavior

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Author Info

  • Lacetera, Nicola

    ()
    (University of Toronto)

  • Macis, Mario

    ()
    (Johns Hopkins University)

  • Slonim, Robert

    ()
    (University of Sydney)

Abstract

We examine how economic incentives affect pro-social behavior through the analysis of a unique dataset with information on more than 14,000 American Red Cross blood drives. Our findings are consistent with blood donors responding to incentives in a "standard" way; offering donors economic incentives significantly increases turnout and blood units collected, and more so the greater the incentive's monetary value. In addition, there is no disproportionate increase in donors who come to a drive but are ineligible to donate when incentives are offered. Further evidence from a small-scale field experiment corroborates these findings and confirms that donors are motivated by the economic value of the items offered. We also find that a substantial fraction of the increase in donations due to incentives may be explained by donors substituting away from neighboring drives toward drives where rewards are offered, and the likelihood of this substitution is higher the higher the monetary value of the incentive offered and if neighboring drives do not offer incentives. Thus, extrinsic incentives motivate pro-social behavior, but unless substitution effects are also considered, the effect of incentives may be overestimated.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 4567.

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Length: 39 pages
Date of creation: Nov 2009
Date of revision:
Publication status: published in: American Economic Journal: Economic Policy, 2012, 4 (1), 186-223 as "Will There be Blood? Incentives and Displacement Effects in Pro-Social Behavior"
Handle: RePEc:iza:izadps:dp4567

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Related research

Keywords: altruism; pro-social behavior; public good provision; incentives; public health;

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References

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  1. Lacetera, Nicola & Macis, Mario, 2008. "Motivating Altruism: A Field Study," IZA Discussion Papers 3770, Institute for the Study of Labor (IZA).
  2. Gary S. Becker & Julio Jorge El�as, 2007. "Introducing Incentives in the Market for Live and Cadaveric Organ Donations," Journal of Economic Perspectives, American Economic Association, vol. 21(3), pages 3-24, Summer.
  3. Götte, Lorenz & Stutzer, Alois, 2008. "Blood Donations and Incentives: Evidence from a Field Experiment," IZA Discussion Papers 3580, Institute for the Study of Labor (IZA).
  4. Dan Ariely & Anat Bracha & Stephan Meier, 2009. "Doing Good or Doing Well? Image Motivation and Monetary Incentives in Behaving Prosocially," American Economic Review, American Economic Association, vol. 99(1), pages 544-55, March.
  5. Gneezy, U. & Rustichini, A., 1998. "Pay Enough - Or Don't Pay at All," Discussion Paper, Tilburg University, Center for Economic Research 1998-57, Tilburg University, Center for Economic Research.
  6. Rick Harbaugh & Theodore To, 2005. "False Modesty: When Disclosing Good News Looks Bad," Working Papers 2005-05, Indiana University, Kelley School of Business, Department of Business Economics and Public Policy.
  7. Mattias Polborn, 2007. "Competing for Recognition through Public Good Provision," CESifo Working Paper Series 1920, CESifo Group Munich.
  8. Alvin E. Roth, 2006. "Repugnance as a Constraint on Markets," NBER Working Papers 12702, National Bureau of Economic Research, Inc.
  9. Harbaugh, William T, 1998. "The Prestige Motive for Making Charitable Transfers," American Economic Review, American Economic Association, vol. 88(2), pages 277-82, May.
  10. repec:feb:artefa:0106 is not listed on IDEAS
  11. Garbarino, Ellen & Slonim, Robert, 2009. "The robustness of trust and reciprocity across a heterogeneous U.S. population," Journal of Economic Behavior & Organization, Elsevier, vol. 69(3), pages 226-240, March.
  12. Carl Mellström & Magnus Johannesson, 2008. "Crowding Out in Blood Donation: Was Titmuss Right?," Journal of the European Economic Association, MIT Press, MIT Press, vol. 6(4), pages 845-863, 06.
  13. Frey, Bruno S & Oberholzer-Gee, Felix, 1997. "The Cost of Price Incentives: An Empirical Analysis of Motivation Crowding-Out," American Economic Review, American Economic Association, vol. 87(4), pages 746-55, September.
  14. Stephan Meier, 2006. "A survey of economic theories and field evidence on pro-social behavior," Working Papers, Federal Reserve Bank of Boston 06-6, Federal Reserve Bank of Boston.
  15. Lacetera, Nicola & Macis, Mario, 2010. "Social image concerns and prosocial behavior: Field evidence from a nonlinear incentive scheme," Journal of Economic Behavior & Organization, Elsevier, vol. 76(2), pages 225-237, November.
  16. John List, 2008. "Informed consent in social science," Artefactual Field Experiments 00086, The Field Experiments Website.
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Cited by:
  1. Judd B. Kessler & Alvin E. Roth, 2011. "Organ Allocation Policy and the Decision to Donate," NBER Working Papers 17324, National Bureau of Economic Research, Inc.
  2. Lan Shi, 2011. "Monetary Rewards, Image Concern, and Intrinsic Motivation: Evidence from a Survey on Blood Donation," Working Papers UWEC-2010-07-R, University of Washington, Department of Economics, revised Feb 2011.

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