Encyclopedia of Law and Economics

2019 Edition
| Editors: Alain Marciano, Giovanni Battista Ramello

Intrinsic and Extrinsic Motivation

  • Rustam RomaniucEmail author
  • Cécile Bazart
Reference work entry
DOI: https://doi.org/10.1007/978-1-4614-7753-2_270

Abstract

The question of human motivation is central to understand the effects of legal rules on people’s behavior. One of the main tenets of law and economics is that incentive systems need to be designed in order to minimize the difference between private and social interests. Legal rules, taxes, subventions, and other external interventions are regarded as necessary to motivate the internalization of externalities. Empirical evidence however suggests that motivation to engage in pro-social behavior may preexist to external incentives. People often avoid cheating, polluting, or littering, and they act pro-socially without considering consequences of deviation to do so. The traditional idea of “laws as price incentives” has a difficult time explaining these phenomena. This is why in the last two decades, one of the most promising research agenda consisted in distinguishing between “extrinsic” and “intrinsic” motivations. The former are linked to actions driven by external incentives, in contrast to the latter driven by personal and internal forces.

This is a preview of subscription content, log in to check access.

References

  1. Andreoni J, Bernheim BD (2009) Social image and the 50–50 norm: a theoretical and experimental analysis of audience effects. Econometrica 77:1607–1636CrossRefGoogle Scholar
  2. Ariely D, Bracha A, Meier S (2009) Doing good or doing well? Image motivation and monetary incentives in behaving prosocially. Am Econ Rev 99:544–555CrossRefGoogle Scholar
  3. Barkema HG (1995) Do executives work harder when they are monitored? Kyklos 48:19–42CrossRefGoogle Scholar
  4. Bénabou R, Tirole J (2003) Intrinsic and extrinsic motivation. Q J Econ 70:489–520Google Scholar
  5. Bohnet I, Cooter R (2003) Expressive law: framing or equilibrium selection? UC Berkley Public Law Research paper no 138Google Scholar
  6. Bohnet I, Frey BS, Huck S (2001) More order with less law: on contract enforcement, trust, and crowding. Am Polit Sci Rev 95:131–144CrossRefGoogle Scholar
  7. Bowles S (2011) Machiavelli’s mistake. Mimeo, Santa Fe InstituteGoogle Scholar
  8. Coase RH (1960) The problem of social cost. J Law Econ 3:1–44CrossRefGoogle Scholar
  9. Deci EL (1971) Effects of externally mediated rewards on intrinsic motivation. J Pers Soc Psychol 18:105–115CrossRefGoogle Scholar
  10. Deci EL, Flaste R (1995) Why we do what we do: Understanding self-motivation. Penguin, New YorkGoogle Scholar
  11. Falk A, Kosfeld M (2006) The hidden costs of control. Am Econ Rev 96:1611–1630CrossRefGoogle Scholar
  12. Fehr E, Rockenbach B (2003) Detrimental effects on sanctions on human altruism. Nature 422:137–140CrossRefGoogle Scholar
  13. Fehr E, Schmidt K (1999) A theory of fairness, competition, and cooperation. Q J Econ 114:817–868CrossRefGoogle Scholar
  14. Feldman Y (2009) The expressive function of trade secret law: legality, cost, intrinsic motivation, and consensus. J Empir Leg Stud 6:177–212CrossRefGoogle Scholar
  15. Festré A, Garrouste P (2014) Theory and evidence in psychology and economics about motivation crowding out: a possible convergence? J Econ Surv.  https://doi.org/10.1111/joes.12059CrossRefGoogle Scholar
  16. Frey BS (1992) Tertium datur: pricing, regulating and intrinsic motivation. Kyklos 45:161–184CrossRefGoogle Scholar
  17. Frey BS (1997a) Not just for the money: an economic theory of personal motivation. Edward Elgar, CheltenhamGoogle Scholar
  18. Frey BS (1997b) A constitution for knaves crowds out civic virtues. Econ J 107:1043–1053CrossRefGoogle Scholar
  19. Frey BS, Stutzer A (2008) Environmental morale and motivation. In: Lewis A (ed) Psychology and economic behavior. Cambridge University Press, Cambridge, pp 406–428Google Scholar
  20. Frey BS, Oberholzer-Gee F, Eichenberger R (1996) Te old lady visits your backyard: a tale of morals and markets. J Polit Econ 104:1297–1313CrossRefGoogle Scholar
  21. Gneezy U, Rustichini A (2000) Pay enough or don’t pay at all. Q J Econ 115:791–810CrossRefGoogle Scholar
  22. Irlenbusch B, Sliwka D (2005) Incentives, decision frames, and motivation crowding-out: An experimental investigation. IZA discussion papers 1879Google Scholar
  23. Kornhauser LA (1988) The new economic analysis of law: legal rules as incentives. In: Mercuro N (ed) Law and economics. Kluwer, Boston, pp 27–55CrossRefGoogle Scholar
  24. Ryan RM, Deci EL (2000) Intrinsic and extrinsic motivations: classic definitions and new directions. Contemp Educ Psychol 25:54–67CrossRefGoogle Scholar
  25. Stout L (2011) Cultivating conscience: How good laws make good people. Princeton University Press, PrincetonGoogle Scholar
  26. Tirole J (2009) Motivation intrinsèque, incitations et normes sociales. Rev Écon 60:577–589CrossRefGoogle Scholar
  27. Titmuss RM (1970) The gift relationship. Allen and Unwin, LondonGoogle Scholar

Copyright information

© Springer Science+Business Media, LLC, part of Springer Nature 2019

Authors and Affiliations

  1. 1.Laboratoire Montpellierain d’économie théorique et appliquée (LAMETA)University of Montpellier; International programme in institutions, economics and law (IEL), University of TurinMontpellierFrance
  2. 2.CEE-M – Univ Montpellier – CNRS – INRA – SupAgroUniversity of MontpellierMontpellierFrance
  3. 3.Laboratoire Montpellierain d’économie théorique et appliquée (LAMETA)University of Montpellier 1MontpellierFrance