Working Paper 07-9
by Dan Ariely, Anat Bracha, and Stephan Meier

This paper examines image motivation—the desire to be liked and well-regarded by others— as a driver in prosocial behavior (doing good), and asks whether extrinsic monetary incentives (doing well) have a detrimental effect on prosocial behavior due to crowding out of image motivation.

By definition, image depends on one’s behavior being visible to other people. Using this unique property we show that image is indeed an important part of the motivation to behave prosocially. Moreover, we show that extrinsic incentives interact with image motivation and are therefore less effective in public than in private. Together, these results imply that image motivation is crowded out by monetary incentives; this means that monetary incentives are more likely to be counterproductive for public prosocial activities than for private ones.

JEL Classifications: D64, C90, H41

PDF version of paper