IDEAS home Printed from https://ideas.repec.org/p/iza/izadps/dp11203.html
   My bibliography  Save this paper

Intentions for Doing Good Matter for Doing Well: The (Negative) Signaling Value of Prosocial Incentives

Author

Listed:
  • Cassar, Lea

    () (University of Cologne)

  • Meier, Stephan

    () (Columbia University)

Abstract

Prosocial incentives and Corporate Social Responsibility (CSR) initiatives are seen by many firms as an effective way to motivate workers. Recent empirical results seem to support the expectation that prosocial incentive, e.g. in the form of a charitable donations by the firm, can increase effort and motivation - sometimes even better than monetary incentives. We argue that the benefits crucially depend on the perceived intention of the firm. Workers use prosocial incentives as a signal about the firm's type and if used instrumentally in order to profit the firm, they can backfire. We show in an experiment in collaboration with an Italian firm, that monetary and prosocial incentives work very differently. While monetary incentives used instrumentally increase effort, instrumental charitable incentives backfire compared to non-instrumental incentives. This is especially true for non-prosocially-motivated workers who do not care about the prosocial cause but use prosocial incentives only as a signal about the firm. The results contribute to the understanding of the limits of prosocial incentives by focusing on their signaling value to the agent about the principal's type.

Suggested Citation

  • Cassar, Lea & Meier, Stephan, 2017. "Intentions for Doing Good Matter for Doing Well: The (Negative) Signaling Value of Prosocial Incentives," IZA Discussion Papers 11203, Institute for the Study of Labor (IZA).
  • Handle: RePEc:iza:izadps:dp11203
    as

    Download full text from publisher

    File URL: http://ftp.iza.org/dp11203.pdf
    Download Restriction: no

    References listed on IDEAS

    as
    1. Fehrler, Sebastian & Kosfeld, Michael, 2014. "Pro-social missions and worker motivation: An experimental study," Journal of Economic Behavior & Organization, Elsevier, vol. 100(C), pages 99-110.
    2. repec:iza:izawol:journl:y:2014:p:17 is not listed on IDEAS
    3. Lea Cassar, 2014. "Job mission as a substitute for monetary incentives: experimental evidence," ECON - Working Papers 177, Department of Economics - University of Zurich.
    4. Christiane Bradler & Robert Dur & Susanne Neckermann & Arjan Non, 2016. "Employee Recognition and Performance: A Field Experiment," Management Science, INFORMS, vol. 62(11), pages 3085-3099, November.
    5. Ashraf, Nava & Bandiera, Oriana & Jack, B. Kelsey, 2014. "No margin, no mission? A field experiment on incentives for public service delivery," Journal of Public Economics, Elsevier, vol. 120(C), pages 1-17.
    6. Sandro Ambuehl & Muriel Niederle & Alvin E. Roth, 2015. "More Money, More Problems? Can High Pay Be Coercive and Repugnant?," American Economic Review, American Economic Association, vol. 105(5), pages 357-360, May.
    7. 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.
    8. repec:eee:jeborg:v:142:y:2017:i:c:p:482-493 is not listed on IDEAS
    9. Alex Imas & Michael A. Kuhn & Vera Mironova, 2016. "Waiting to Choose," CESifo Working Paper Series 6162, CESifo Group Munich.
    10. repec:hrv:faseco:30829771 is not listed on IDEAS
    11. Karine Nyborg, 2014. "Do responsible employers attract responsible employees?," IZA World of Labor, Institute for the Study of Labor (IZA), pages 1-17, May.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    prosocial incentives; Corporate Social Responsibility; signaling;

    JEL classification:

    • D03 - Microeconomics - - General - - - Behavioral Microeconomics: Underlying Principles
    • C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments
    • M52 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Compensation and Compensation Methods and Their Effects

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:iza:izadps:dp11203. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Mark Fallak). General contact details of provider: http://www.iza.org .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.