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Incentives, Self-Selection, and Coordination of Motivated Agents for the Production of Social Goods

Author

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  • Bauer, Kevin

    (Leibniz Institute for Financial Research SAFE)

  • Kosfeld, Michael

    (Goethe University Frankfurt)

  • von Siemens, Ferdinand

    (Goethe University Frankfurt)

Abstract

We study, theoretically and empirically, the effects of incentives on the self-selection and coordination of motivated agents to produce a social good. Agents join teams where they allocate effort to either generate individual monetary rewards (selfish effort) or contribute to the production of a social good with positive effort complementarities (social effort). Agents differ in their motivation to exert social effort. Our model predicts that lowering incentives for selfish effort in one team increases social good production by selectively attracting and coordinating motivated agents. We test this prediction in a lab experiment allowing us to cleanly separate the selection effect from other effects of low incentives. Results show that social good production more than doubles in the low-incentive team, but only if self-selection is possible. Our analysis highlights the important role of incentives in the matching of motivated agents engaged in social good production.

Suggested Citation

  • Bauer, Kevin & Kosfeld, Michael & von Siemens, Ferdinand, 2021. "Incentives, Self-Selection, and Coordination of Motivated Agents for the Production of Social Goods," IZA Discussion Papers 14595, Institute of Labor Economics (IZA).
  • Handle: RePEc:iza:izadps:dp14595
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    References listed on IDEAS

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    Cited by:

    1. Haylock, Michael & Kampkötter, Patrick & Kosfeld, Michael & von Siemens, Ferdinand, 2023. "Helping and Antisocial Behavior in the Workplace," VfS Annual Conference 2023 (Regensburg): Growth and the "sociale Frage" 277645, Verein für Socialpolitik / German Economic Association.

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    More about this item

    Keywords

    incentives; intrinsic motivation; self-selection; public service;
    All these keywords.

    JEL classification:

    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • D90 - Microeconomics - - Micro-Based Behavioral Economics - - - General
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • M52 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Compensation and Compensation Methods and Their Effects

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