Moral Regulation in Sequential Decisions

Do individuals become more generous after harming others, or less generous after doing the right thing? We study whether moral behavior spills over across sequential decisions through moral accounting: individuals may offset prior moral debts through subsequent prosocial behavior (moral cleansing) or draw on prior moral credits to justify lower generosity (moral licensing). In an online experiment, participants first make a fair or unfair allocation in a Dictator Minigame. They then learn whether the Receiver’s payoff was determined by their own choice or by chance, and make an unanticipated decision about whether to donate part of their earnings to a charity. By varying responsibility for realized social outcomes, the design generates different moral states associated with the same first-stage choice, which can trigger compensatory behavior in the subsequent donation decision. We find a sharp asymmetry. After choosing the fair allocation, being responsible for the Receiver’s favorable outcome significantly reduces subsequent donations, consistent with moral licensing. After choosing the unfair allocation, responsibility has no average effect on giving, but this null effect conceals substantial heterogeneity in individual responses. Overall, the results show that responsibility for outcomes can shape later prosocial behavior, but does so asymmetrically across good and bad deeds.