The Hidden Benefits of Control: Evidence from a Natural Field Experiment / Craig E. Landry, Andreas Lange, John A. List, Michael K. Price, Nicholas G. Rupp.

Format:

Book

Author/Creator:

Landry, Craig E.

Contributor:

National Bureau of Economic Research.

Lange, Andreas.

List, John A.

Price, Michael K.

Rupp, Nicholas G.

Series:

Working Paper Series (National Bureau of Economic Research) no. w17473.

NBER working paper series no. w17473

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Other Title:

The Hidden Benefits of Control

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 2011.

Summary:

An important dialogue between theorists and experimentalists over the past few decades has raised the study of the interaction of psychological and economic incentives from academic curiosity to a bona fide academic field. One recent area of study within this genre that has sparked interest and debate revolves around the "hidden costs" of conditional incentives. This study overlays randomization on a naturally-occurring environment in a series of temporally-linked field experiments to advance our understanding of the economics of charity and test if such "costs" exist in the field. This approach permits us to examine why people initially give to charities, and what factors keep them committed to the cause. Several key findings emerge. First, there are hidden benefits of conditional incentives that would have gone undetected had we maintained a static theory and an experimental design that focused on short run substitution effects rather than dynamic interactions. Second, we can reject the pure altruism model of giving. Third, we find that public good provision is maximized in both the short and long run by using conditional, rather than unconditional, incentives.

Notes:

Print version record

September 2011.