The Effects of Moral Licensing and Moral Cleansing in Contingent Valuation and Laboratory Experiments on the Demand to Reduce Externalities

Recent field experiments show that peer information can induce people to reduce their production of negative externalities. Related work in psychology demonstrates that inducing feelings of relative culpability in one domain can induce spillover pro-social behavior in another domain. We use a contingent valuation and parallel lab experiment to explore patterns of cross-domain responses to norm-based interventions. Asymmetric responses between those whose impacts are above or below the norm are found to be robust across decision settings. Substantial heterogeneity in responses is observed across a number of dimensions not explored in large field experiments, raising questions about the universality of peer-information effects and the design of such programs.