Crowding-in, crowding-out and over-crowding: The interaction between price and quantity based instruments and intrinsic motivation
AbstractWe conduct a field experiment involving real purchasing decisions in a large supermarket chain to test the effect of different regulatory interventions aiming to induce a more climateâ€friendly diet on intrinsic motivation. Focusing on shoppers who prefer the dirty variety, we compare labeling, a subsidy, a product ban and neutrally framed versions of the latter two in their ability to induce shoppers to switch to cleaner varieties. Carbon footprint labels and bans activate intrinsic motivation of shoppers (crowdingâ€in). Remarkably, a subsidy framed as an explicit intervention is less effective than both a label and an equivalent but neutrally framed price change. The effects of information and changes in relative prices are not only not additive (crowdingâ€out) but combined perform worse than each individually (overâ€crowding). We therefore find markedly different effects of price and quantity based instruments on intrinsic motivation.
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Bibliographic InfoPaper provided by School of Economics, University of East Anglia, Norwich, UK. in its series Working Paper series, University of East Anglia, Centre for Behavioural and Experimental Social Science (CBESS) with number 11-10.
Date of creation: 01 Mar 2011
Date of revision:
Postal: Helen Chapman, School of Economics, University of East Anglia, Norwich Research Park, Norwich, NR4 7TJ, UK
Find related papers by JEL classification:
- Q18 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Policy; Food Policy
- Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters
- Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy
- H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
- H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
- C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments
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