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

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Listed:
  • Nicola Lacetera
  • Mario Macis
  • Robert Slonim

Abstract

We present evidence from nearly 14,000 American Red Cross blood drives and from a natural field experiment showing that economic incentives have a positive effect on blood donations without increasing the fraction of donors who are ineligible to donate. The effect increases with the incentive's economic value. However, a substantial proportion of the increase in donations is explained by donors leaving neighboring drives without incentives to attend drives with incentives; this displacement also increases with the economic value of the incentive. We conclude that extrinsic incentives stimulate prosocial behavior, but unless displacement effects are considered, the effect may be overestimated. (JEL D64, H41, I12)

Suggested Citation

  • Nicola Lacetera & Mario Macis & Robert Slonim, 2012. "Will There Be Blood? Incentives and Displacement Effects in Pro-social Behavior," American Economic Journal: Economic Policy, American Economic Association, vol. 4(1), pages 186-223, February.
  • Handle: RePEc:aea:aejpol:v:4:y:2012:i:1:p:186-223 Note: DOI: 10.1257/pol.4.1.186
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    References listed on IDEAS

    as
    1. Carl Mellström & Magnus Johannesson, 2008. "Crowding Out in Blood Donation: Was Titmuss Right?," Journal of the European Economic Association, MIT Press, vol. 6(4), pages 845-863, June.
    2. Andreoni, James, 1989. "Giving with Impure Altruism: Applications to Charity and Ricardian Equivalence," Journal of Political Economy, University of Chicago Press, vol. 97(6), pages 1447-1458, December.
    3. 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 746-755, September.
    4. John A. List, 2011. "The Market for Charitable Giving," Journal of Economic Perspectives, American Economic Association, pages 157-180.
    5. Lacetera, Nicola & Macis, Mario, 2010. "Do all material incentives for pro-social activities backfire? The response to cash and non-cash incentives for blood donations," Journal of Economic Psychology, Elsevier, vol. 31(4), pages 738-748, August.
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    More about this item

    JEL classification:

    • D64 - Microeconomics - - Welfare Economics - - - Altruism; Philanthropy; Intergenerational Transfers
    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
    • I12 - Health, Education, and Welfare - - Health - - - Health Behavior

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