Does monetary punishment crowd out pro-social motivation? The case of hospital bed-blocking
We study whether the use of explicit monetary incentives might be counter-productive. In particular, we focus on the effect of fining owners of long-term care institutions who prolong length of stay at hospitals. We outline a simple theoretical model, based on motivational crowding theory, deriving the conditions for explicit monetary incentives to have potentially counterproductive effects. In the empirical part, we exploit a natural experiment involving changes in the catchments areas of two large Norwegian hospitals. We find that bed-blocking is reduced when transferring long-term care providers from a hospital using monetary fines to prevent bed-blocking to a hospital not relying on this incentive scheme, and vice versa. We interpret these results as examples of monetary incentives crowding out agents’ intrinsic motivation, leading to a reduction in effort.
|Date of creation:||2008|
|Contact details of provider:|| Postal: Núcleo de Investigação em Políticas Económicas, Escola de Economia e Gestão, Universidade do Minho, P-4710-057 Braga, Portugal|
Phone: +351-253604510 ext 5532
Web page: http://www3.eeg.uminho.pt/economia/nipe/versao_inglesa/index_uk.htm
More information through EDIRC
|Order Information:|| Email: |
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Stephan Meier, 2006. "A survey of economic theories and field evidence on pro-social behavior," Working Papers 06-6, Federal Reserve Bank of Boston.
- Roland Bénabou & Jean Tirole, 2006.
"Incentives and Prosocial Behavior,"
- Roland Bénabou & Jean Tirole, 2005. "Incentives and Prosocial Behavior," NBER Working Papers 11535, National Bureau of Economic Research, Inc.
- Roland Benabou & Jean Tirole, 2004. "Incentives and Prosocial Behavior," Working Papers 137, Princeton University, Woodrow Wilson School of Public and International Affairs, Discussion Papers in Economics.
- Bénabou, Roland & Tirole, Jean, 2003. "Incentives and Prosocial Behavior," IDEI Working Papers 389, Institut d'Économie Industrielle (IDEI), Toulouse, revised Jan 2006.
- Benabou, Roland & Tirole, Jean, 2005. "Incentives and Prosocial Behavior," IZA Discussion Papers 1695, Institute for the Study of Labor (IZA).
- Bénabou, Roland & Tirole, Jean, 2004. "Incentives and Prosocial Behaviour," CEPR Discussion Papers 4633, C.E.P.R. Discussion Papers.
- Frey, Bruno S & Jegen, Reto, 2001. " Motivation Crowding Theory," Journal of Economic Surveys, Wiley Blackwell, vol. 15(5), pages 589-611, December.
- Gneezy, Uri & Rustichini, Aldo, 2000.
"A Fine is a Price,"
The Journal of Legal Studies,
University of Chicago Press, vol. 29(1), pages 1-17, January.
- Roland Bénabou & Jean Tirole, 2003. "Intrinsic and Extrinsic Motivation," Review of Economic Studies, Oxford University Press, vol. 70(3), pages 489-520.
- Frey, Bruno S., 1993. "Motivation as a limit to pricing," Journal of Economic Psychology, Elsevier, vol. 14(4), pages 635-664, December.
- Lai, Ching-Chong & Yang, Chih-Yu & Chang, Juin-Jen, 2003. "Environmental Regulations and Social Norms," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 10(1), pages 63-75, January.
When requesting a correction, please mention this item's handle: RePEc:nip:nipewp:17/2008. 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: (Maria João Thompson)
If references are entirely missing, you can add them using this form.