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Title:Commitment to self-rewards PDF Logo
Authors:Koch, Alexander K.
Nafziger, Julia
Issue Date:2009
Series/Report no.:IZA discussion papers 4049
Abstract:Self-administered rewards are ubiquitous. They serve as incentives for personal accomplishments and are widely recommended as tools for overcoming self-control problems. However, it seems puzzling why self-rewards can work: the prospect of a reward has a motivating force only if the threat of self-denial of the reward after low performance is credible. We explain how a rational forward-looking individual may achieve commitment to self-rewards, by applying Köszegi and Rabin's (2006) model of endogenous reference point formation to a self-regulation problem. Our results show why and when self-regulation built on self-rewards can be successful and thus illustrate the power, but also the limits, of self-rewards.
Subjects:Self-control
motivation
self-reinforcement
time inconsistency
reference-dependent preferences
JEL:A12
C70
D86
Persistent Identifier of the first edition:urn:nbn:de:101:1-20090323189
Document Type:Working Paper
Appears in Collections:IZA Discussion Papers, Forschungsinstitut zur Zukunft der Arbeit (IZA)

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