A Price is a signal: on intrinsic motivation and crowding-out
AbstractIf a previously unpaid activity (donating blood) is paid then we often observe that this activity is reduced. In this paper, it is hypothesised that the price offered is taken as a proxy for the "market value" of the activity. Depending on how the actor valued the activity previously, crowding-out or crowding-in, as well as persistence (or not) of the effect after the abandoning of payment is implied. This "naive" explanation is confronted with Bénabou and Tirole´s (2003) priciple-agent model where the opposite signalling effect is hypothesised: a higher price is taken as an indication for a lower value. --
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Bibliographic InfoPaper provided by European University Viadrina Frankfurt (Oder), Department of Business Administration and Economics in its series Discussion Papers with number 250.
Date of creation: 2007
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Intrinsic Motivation; Crowding-out; Signaling;
Find related papers by JEL classification:
- H42 - Public Economics - - Publicly Provided Goods - - - Publicly Provided Private Goods
- D64 - Microeconomics - - Welfare Economics - - - Altruism; Philanthropy
- D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
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