Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/55597 
Year of Publication: 
2009
Series/Report no.: 
Working Papers No. 09-2
Publisher: 
Federal Reserve Bank of Boston, Boston, MA
Abstract: 
Monetary incentives are often considered as a way to foster contributions to public goods in society and firms. This paper investigates experimentally the effect of monetary incentives in the presence of a norm enforcement mechanism. Norm enforcement through peer punishment has been shown to be effective in raising contributions by itself. We test whether and how monetary incentives interact with punishment and how this in turn affects contributions. Our main findings are that free riders are punished less harshly in the treatment with incentives, and as a consequence, average contributions to the public good are no higher than without incentives. This finding ties to and extends previous research on settings in which monetary incentives may fail to have the desired effect.
Subjects: 
public goods
experimental economics
norm enforcement
hidden costs of incentives
JEL: 
C72
C92
D23
H41
Document Type: 
Working Paper

Files in This Item:
File
Size
497.78 kB





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.