Incentives and Prosocial Behavior
Abstract
We develop a theory of prosocial behavior that combines heterogeneity in individual altruism and greed with concerns for social reputation or self-respect. Rewards or punishments (whether material or image-related) create doubt about the true motive for which good deeds are performed, and this “overjustification effect” can induce a partial or even net crowding out of prosocial behavior by extrinsic incentives. We also identify the settings that are conducive to multiple social norms and, more generally, those that make individual actions complements or substitutes, which we show depends on whether stigma or honor is (endogenously) the dominant reputational concern. Finally, we analyze the socially optimal level of incentives and how monopolistic or competitive sponsors depart from it. Sponsor competition is shown to potentially reduce social welfare.
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Consideration of both reputation and others' approval may prevent neural effects from translating into explicit changes in behavior.
“Although oxytocin significantly reduces amygdala representations of social values, consideration of both reputation 44 and others' approval 45 may prevent neural effects from translating into explicit changes in behavior.”
From Oxytocin modulates social value representations in the amygdala (2019) · cites this paper as [45]
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- Authors
- Bénabou, R., & Tirole, J.
- Affiliations
- Canadian Institute for Advanced Research (CA)
- Institut d'Economie Industrielle, 21 Allées de Brienne, 31000 Toulouse, France, Groupe de Recherche en Économic Mathématique et Quantitative, Centre d'Enseignement et de Recherche en Analyse Socioéconomique, and Massachusetts Institute of Technology.
- ORCID
- Bénabou, Roland
- Venue
- American Economic Review
- Publisher
- American Economic Association
- Published
- 2006-11-01
- Volume
- 96
- Issue
- 5
- Pages
- 1652-1678
- ISSN
- 0002-8282 (ISSN-L)
- OpenAlex
- W3125145917
- Cited by
- 3,357
- References
- 93
- Citations by year
- 2026: 214 · 2025: 222 · 2024: 217 · 2023: 209 · 2022: 212 · 2021: 228 · 2020: 208 · 2019: 215 · 2018: 203 · 2017: 199 · 2016: 154 · 2015: 186 · 2014: 190 · 2013: 156 · 2012: 119
- FWCI
- 179.49
- Type
- journal article
- Language
- en
- Open access
- closed
- Locations
- American Economic Review (publishedVersion)
- RePEc: Research Papers in Economics (submittedVersion)
- Topics
- Social Sciences › Safety Research › Experimental Behavioral Economics Studies
- Social Sciences › Sociology and Political Science › Nonprofit Sector and Volunteering
- Social Sciences › Sociology and Political Science › Evolutionary Game Theory and Cooperation
- Keywords
- prosocial behavior, altruism, greed, social reputation, self-respect, overjustification effect, extrinsic rewards, crowding out, social norms, stigma, honor, incentive design, social welfare (welfare economics)
About these checks
Registry, retraction, Cites and statistics results are computed, not judged, with one exception: a printed reference that no index lists is read once by a model before it counts as a citation error. Claims are extracted by a model and kept only when their quote appears verbatim in the text; each cited source is then checked, with a model’s help, for whether it says what the claim relies on. Those verdicts can be wrong — read the claim’s quote and the cited source before relying on one.
Statistics and arithmetic are recomputed, not judged.
Confidence bands are shown only for fields calibrated on our annotated test set. None is calibrated yet, so no band is shown.
What counts as a claim ›How we measure confidence ›How we check this ›
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