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Forgoing earned incentives to signal pure motives

Author

Listed:
  • Erika L. Kirgios

    (Department of Operations, Information and Decisions, The Wharton School, University of Pennsylvania, Philadelphia, PA 19104)

  • Edward H. Chang

    (Department of Operations, Information and Decisions, The Wharton School, University of Pennsylvania, Philadelphia, PA 19104)

  • Emma E. Levine

    (Department of Behavioral Science, Booth School of Business, University of Chicago, Chicago, IL 60637)

  • Katherine L. Milkman

    (Department of Operations, Information and Decisions, The Wharton School, University of Pennsylvania, Philadelphia, PA 19104)

  • Judd B. Kessler

    (Department of Business Economics and Public Policy, The Wharton School, University of Pennsylvania, Philadelphia, PA 19104)

Abstract

Policy makers, employers, and insurers often provide financial incentives to encourage citizens, employees, and customers to take actions that are good for them or for society (e.g., energy conservation, healthy living, safe driving). Although financial incentives are often effective at inducing good behavior, they’ve been shown to have self-image costs: Those who receive incentives view their actions less positively due to the perceived incompatibility between financial incentives and intrinsic motives. We test an intervention that allows organizations and individuals to resolve this tension: We use financial rewards to kick-start good behavior and then offer individuals the opportunity to give up some or all of their earned financial rewards in order to boost their self-image. Two preregistered studies—an incentivized online experiment ( n = 763) on prosocial behavior and a large field experiment ( n = 17,968) on exercise—provide evidence that emphasizing the intrinsic rewards of a past action leads individuals to forgo or donate earned financial rewards. Our intervention allows individuals to retroactively signal that they acted for the right reason, which we call “motivation laundering.” We discuss the implications of motivation laundering for the design of incentive systems and behavioral change.

Suggested Citation

  • Erika L. Kirgios & Edward H. Chang & Emma E. Levine & Katherine L. Milkman & Judd B. Kessler, 2020. "Forgoing earned incentives to signal pure motives," Proceedings of the National Academy of Sciences, Proceedings of the National Academy of Sciences, vol. 117(29), pages 16891-16897, July.
    • Handle: RePEc:nas:journl:v:117:y:2020:p:16891-16897
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    Cited by:

    1. Graf, Caroline & Suanet, Bianca & Wiepking, Pamala & Merz, Eva-Maria, 2023. "Social norms offer explanation for inconsistent effects of incentives on prosocial behavior," Journal of Economic Behavior & Organization, Elsevier, vol. 211(C), pages 429-441.
    2. Yan, Liuxin & Emil Chai, Valentino & Chi Yam, Kai, 2024. "Demeaning extrinsic motivation leads to increased perceptions of hypocrisy," Organizational Behavior and Human Decision Processes, Elsevier, vol. 180(C).
    3. Caroline Graf & Eva-Maria Merz & Bianca Suanet & Pamala Wiepking, 2021. "Social Norms Offer Explanation for Inconsistent Effects of Incentives on Prosocial Behavior," Papers 2104.13652, arXiv.org.

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