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« Do Good Deeds Make Bad People? »
Sophie CLOT,
Gilles GROLLEAU,
Lisette IBANEZ
DR n°2011-21
1
Do Good Deeds Make Bad People?
1
November 2011
Sophie Clot
Montpellier SupAgro, UMR 1135 LAMETA, F-34000 Montpellier, France
Gilles Grolleau
Montpellier SupAgro, UMR 1135 LAMETA, F-34000 Montpellier, France
Lisette Ibanez
INRA, UMR 1135 LAMETA, F-34000 Montpellier, France
Abstract: A limited but growing literature contends that licensing can operate by committing to a
virtuous act in a preceding choice, which reduces negative self-attributions associated with donating
less or behaving less virtuously in the succeeding decision. Psychological research and behavioral
economics strongly suggest that pre-existing intrinsic motivations of individuals play a major role in
determining their subsequent choices when faced with a voluntary or mandatory virtuous ‘act’. In
this paper, we report the results of a pilot experimental study examining licensing effect in the
environmental realm, using a 2 (mandatory or voluntary nature of the virtuous act) X 2 (intrinsically
or non-intrinsically motivated individuals) between subjects design. We found that intrinsically
motivated and non-intrinsically motivated subjects reacted adversely to the two policy scenarios. The
licensing effect occurs when combining intrinsically (resp., non-intrinsically) motivated individuals
and mandatory (resp. voluntary) conditions.
Key words: Licensing effect, environmental policies, behavioural incentives
JEL: Q50, D03, D04
1
We gratefully acknowledge Nina Mazar, Sandrine Costa, Kate Farrow and Naoufel Mzoughi for constructive
comments as well as participants at PERENE workgroup. We also thank Claire Mangani, Sébastien Roussel,
Mélanie Jaeck and Peguy Ndodjang for having facilitated data collection. The usual disclaimer applies.
2
Do Good Deeds Make Bad People?
1. Introduction
Does a commitment to a virtuous act encourage us to behave more virtuously or free us to behave
less virtuously in subsequent acts? For example, Monbiot (2009) reports the story of a couple who
‘earned so many vouchers from recycling at Tesco (a U.K. retailer) that they were able to fly to the
Caribbean for a holiday. The greenhouse gases caused by these flights outweigh any likely savings
from recycling hundreds or thousands of times over.’ A small and recent, but growing body of
experimental research (in numerous areas) has been devoted to understanding how people license
themselves based on prior behaviors to pursue inconsistent goals (e.g., Khan and Dhar, 2006;
Sachdeva et al., 2009; Mazar and Zhong, 2010; Chiou and al., 2011). For instance, Chiou and al.
(2011) showed that smokers who believed they were taking a dietary supplement smoked more
cigarettes than did controls, presumably because they think the supplements will protect them
against smoking’s ill effects. Nevertheless, as far as we know, no study has examined what happens if
the ‘virtuous’ act is imposed on individuals or freely chosen by them. Psychological research and
behavioral economics strongly suggest that pre-existing or intrinsic motivations play a major role in
determining people’s subsequent choices when faced with a voluntary or mandatory virtuous ‘act’.
In this paper, we report the results of a pilot experimental study examining licensing effect in the
environmental realm. Our 2 (mandatory or voluntary nature of the virtuous act) X 2 (intrinsically
motivated or non-intrinsically motivated individuals) between-subjects design extends the literature
in at least two dimensions. First, we test whether the licensing effect occurs when the virtuous act is
voluntarily or mandatorily generated. Indeed, in the environmental realm people frequently face
either an obligation to adopt some behaviors (e.g., speed limits to reduce pollution) or are simply
encouraged to adopt others (e.g., Earth hour). Second, we examine the effect of the way the virtuous
act is generated (voluntarily or mandatorily) according to whether individuals are either intrinsically
motivated or not. We are aware of no other study of this type in the licensing effect literature.
A mixed set of results emerges from our experiment. We found that intrinsically motivated or non-
intrinsically motivated subjects reacted adversely to the two policy scenarios. More precisely, the
3
licensing effect occurs when combining intrinsically (non-intrinsically) motivated individuals and
mandatory (voluntary) conditions.
The remainder of the paper is organized as follows. The next section overviews the related literature
and introduces our hypotheses. Section 3 exposes the empirical strategy. The results are presented
and discussed in section 4. Section 5 provides some policy implications and concludes.
2. Overview of related literature and hypotheses
According to prospect theory (Kahneman and Tversky, 1979), people do not have absolute
preference, but rather preferences that are relative to some anchor point. If one of the key
contributions has been to empirically prove that preferences are endogenous, the relation between
passed actions and subsequent decisions remains largely unexplored.
The idea of a licensing effect has been emerging recently. The literature in marketing and psychology
hold several recent works (Table 1) showing that moral licensing can operate by committing to a
virtuous act in a preceding choice, which reduces negative self-attributions associated with donating
less or behaving less virtuously in the succeeding decision.
Khan and Dhar (2006) studied individuals’ decision process in terms of luxury products consumption.
They first found out in a pretest that luxury products are associated with less moral attributes. They
then demonstrated how an initial situation referring to a charity act, could influence preferences for
unnecessary or extravagant items in subsequent decisions. The results of their experience show that
preference for luxury items was significantly higher in the case of a preceding charity action (license
condition), than in the case where no prior charity action (control condition) had to be undertaken
first (i.e. 57.4% selected a luxury item in the license condition vs. 27.7% in the control condition).
Also, participants rated themselves significantly more positively on a 7 points scale within four
attributes
2
(i.e. “I am compassionate”, “I am sympathetic”, “I am warm”, and “I am helpful”) in the
licensing condition, meaning that an initial altruistic intent boosts the self-concept and may liberate
people to choose more indulgent options (i.e. average of feelings was 5.76 in the license condition vs.
4.79 in the control condition).
2
These items were utilized because they indicated a high degree of reliability in terms of coefficient
alpha (Cronbach’s α=0.84)
4
Studying this behavioural mechanism in the case of altruism and charity donation, Sachdeva, Iliev
and Medin (2009) found that moral regulation mechanisms might happen in the reverse order and
create a compensation effect (behaving ‘indulgently’ first and then compensate with a more virtuous
act). The authors hypothesized that priming people with positive and negative traits in a first stage
will affect subsequent moral behaviour in terms of donation to a charity found. Their results show
that among the 46 individuals who participated in the survey, those who wrote something positive
about themselves gave one fifth as much as those who wrote a story referring to negative traits
(average amount of donation was $1.07 over $10 in the positive condition vs. $5.30 in the negative
condition). They observed that if people feel as if they have been less ethical than they should, they
might compensate by behaving more morally in a subsequent context. The authors included this set
of compensatory behaviours under a blanket term of “moral cleansing”, which refers to actions
people engage in when their moral self-value has been threatened.
Mazar and Zhong (2010) examined the moral licensing effect in the field of the environment. The
authors addressed two main questions: 1) the impact of exposure vs. purchase on moral licensing
effect and 2) how far the regulation process may lead people to behave unethically. First, the results
show that participants who were merely exposed to the green store shared more money in the
dictator game than those who were merely exposed to the conventional store (average amount
shared was $2.18 over $6 in the green store exposure condition vs. $1.59 in the conventional store
exposure condition), whereas participants who had purchased in the green store shared less money
than those who purchased in the conventional store (average amount shared was $1.76 over $6 in
the green store purchase condition vs. $2.12 in the conventional store purchase condition). Second,
the results also demonstrate that participants who chose to buy products from the green array were
more likely to purposefully behave dishonestly such as cheating and stealing in a subsequent task.
Mazar and Zong (2010) concluded that green products can establish enough moral capital to
encourage clear transgressions such as lying and stealing.
We could resume this literature review in three main points. First, a licensing effect does occur and it
matters in various domains. Second, it can happen in the reverse order ('compensation effect').
Third, when a high level of moral capital is 'credited', it can even lead to dishonesty and encourage
clear moral transgressions.
5
Table 1. Experimental studies devoted to the licensing effect
Authors and
publication year
Khan and Dhar (2006)
Sachdeva, Lliev and
Medin (2009)
Mazar and Zhong
(2010)
Mazar and Zhong
(2010)
Chiou, Wan, Wu and Lee
(2011)
Jordan, Mullen, and
Murnighan (2011)
Experimental design:
virtuous act and
subsequent choices
Single-factor (help a
friend vs. control)
between-participants
design, followed by a
dictator game
Two-factors (personal
story writing using:
negative traits vs
positive traits vs
neutral traits),
between-participants
design, followed by a
dictator game
2 (store: conventional
vs. green) x 2 (action:
mere exposure vs.
purchase) between-
participants design,
followed by a dictator
game
Single-factor (store:
conventional vs.
green) between-
participants design,
followed by a lying
and stealing games
Single-factor (credentials:
with or without)
between-participants
design
2 (target: self, other) × 2
(recall: moral, immoral)
between-participants
design
Type and nature of
subjects
80 Students
46 Students
156 Students
90 students
80 Students
168 Students
Main results
Participants in the
licensing conditions
gave less than
participants in the
control group (Mean of
donation= $1.20 over
$2 vs $1.70)
Participants who wrote
a positive story about
themselves gave less
than the two other
groups (Mean of
donation= $1.07 over
$10 vs $5.30 for those
in the negative
condition and $2.71 for
those in the neutral
condition)
Mere exposure to
green products
increases pro social
behavior whereas
purchasing them
licenses (Mean of
donation= $2.12 over
$6 vs $1.76)
Participants in the
green store took in
total (due to both
lying and stealing) on
average $0.83 more
than those in the
conventional store
(over $2.93).
Credentials created by
vitamins use can increase
smokers’ comfort with
consuming more
cigarettes.
Increased invulnerability
is associated with
attitudes towards dietary
supplements (r=0.39, P <
0.001).
Recalling (im)moral
behavior affects an
individual’s reported
moral behavior and moral
intentions but also affects
an individual’s actual
(im)moral behavior. The
morality ratings are
positively correlated with
the magnitude of
cheating (r = .34, p = .002)
These effects did not
emerge when recalling
other’s im(moral)
behavior.
6
Behavioral hypotheses
Rewarding or imposing constraints on individuals can push them to adopt behaviors that will not be
adopted otherwise. In plausible circumstances, demonstration of authority such as rules and laws
could build norms, by suggesting that an event is important enough to justify a costly intervention
(Nyborg, 1999). Nevertheless, if intrinsic motivations preexist, introducing additional external
incentives (e.g. authoritarian decision; monetary rewards) to reinforce the intrinsically motivated
behavior can backfire (Frey and Oberholzer-Gee, 1997; Frey and Jegen, 2001; Bowles, 2008). A
growing literature argues that external interventions crowd out intrinsic motivation (Bénabou and
Tirole, 2006) and some empirical evidence has been given by various authors in support (e.g., Gneezy
and Rustichini, 2000; Vollan, 2008; Bowles, 2008). The crowding out effect is more likely to occur
when external interventions are controlling (rather than supportive), the degree of participants’ self-
determination is low (rather than high) and the level of trust and reciprocity within a society is low
(Vollan, 2008). For instance, Chang and Lai (1999), found that a rise in monitoring intensity tends to
lower, rather than enhance, work effort. In relation with the previous literature, we formulate our
two main hypotheses:
H1: A mandatory ‘virtuous act’ by intrinsically (non-intrinsically) motivated individuals increases
(decreases) the licensing effect.
H2: A voluntary ‘virtuous act’ by intrinsically (non-intrinsically) motivated individuals decreases
(increases) the licensing effect.
The design of our experiment is presented in table 2. We investigate how two subgroups of the
population (intrinsically motivated vs. non-intrinsically motivated) react to the way the ‘good deed’
(mandatorily vs. voluntarily) is generated. We explore whether the licensing effect occurs and draw
some policy implications regarding the use of voluntary or mandatory instruments.
7
Table 2. Between subjects research design used to control for the conditions leading to the
licensing effect
Scenarios
Conditions
Intrinsically motivated individuals
Non-intrinsically motivated individuals
Mandatory ‘virtuous act’
Licensing effect
No licensing effect
Voluntary ‘virtuous act’
No licensing effect
Licensing effect
3. Experimental design
In the spring of 2011, we conducted a set of experiments with students at high education institutions
of Montpellier (South of France) from both business-related majors and environmental-related
majors. In line with previous analyses (Frank, 2003), we assume that students self-select and it is
well-known that students choose their majors at least partly because of their interests for the
studied domains
3
. We contend that individuals enrolled in environmental-related majors are
intrinsically motivated regarding environmental issues whereas individuals enrolled in business-
related majors are non-intrinsically motivated regarding the same issues
4
. These two types of
students should allow us to capture the potential effect of intrinsic motivation over our experimental
design. Participants were not informed previously that they will participate in an experiment to avoid
any selection bias. Students were already there for their lectures and the experiment was presented
as a classroom activity at the end of the lecture. Experiments lasted less than 5 mn. Participants were
not informed about the nature of the experiment we would be conducting or the treatment to which
they would be assigned. In each 30 students group, students were promised a 30€ prize by drawing
lots. This incentive compatibility method was preferred because of the well-known bias leading
people to overweight small probabilities (Chen and Jia, 2005; Burns, Chiu and Wu, 2010).
A subject’s experience followed four steps. First, all subjects received a copy of the instructions and
the monitor read the instructions aloud. Second, all subjects received closed envelopes containing a
3
This point is consistent with Frank’s finding (2003). Frank’s (2003) survey on Cornell graduates show
that 88 percent of socially concerned respondents would prefer a job for the American Cancer Society rather than
for Camel Cigarettes with an average compensating wage premium of about $ 24.000 per year. Cornell graduates
were invited to choose between pairs of hypothetical jobs where the job nature was the same but the employers’
social responsibility reputation was different.
4
For sake of exposition, we distinguish intrinsically motivated and non-intrinsically motivated but we are
conscious that the reality is more nuanced. In short, we contend that business-students also truly care about the
environment, but maybe not as strongly as environment-students.
8
questionnaire corresponding either to (i) a dictator game where they can share the 30€ prize with an
environmental union without any previous commitment to a virtuous act (=control group); (ii) the
possibility to commit voluntarily to an environmentally friendly act followed by the previously
described dictator game (=treatment one); (iii) the mandatory act followed by the previously
described dictator game (=treatment two). Table 3 gives an overview of our experimental design.
Both mandatory and voluntary acts were based on cheap talk framing.
The voluntary framing states: << 1/ You have the opportunity to get involved in a pro
environmental program one hour per week during a month. Do you wish to engage? => Yes
or No. 2/ On a 1 to 9 scale, select the satisfaction level that best describes yours after that
decision>>
The mandatory framing states: << 1/ Your University decides to settle a mandatory pro
environmental program in which you have to get involved one hour per week during a
month. 2/ On a 1 to 9 scale, select the satisfaction level that best describes yours after that
decision>>.
The satisfaction scale’s records aimed mostly at making sure that subjects put some attention on the
imagined act. Since both conditions (mandatory and voluntary) are based on cheap talk, it should
theoretically not make any difference in participants’ willingness to donate. Nevertheless, we believe
that imagining committing to a virtuous act is sufficient to induce a licensing effect. Beside,
everything was done to avoid attracting the attention of subjects regarding questionnaire variations
(e.g., identical envelopes, similar questionnaire size, and identical questionnaires on a given row).
Third, participants were given one minute and thirty seconds to fill in the questionnaires
anonymously. After the time elapsed, sheets were collected and the winning number was
announced. The amount corresponding to the winner’s decision was put inside an empty envelope
and given to the winner by the professor at the end of the lecture.
Table 3. Experimental Design
Control
Treatment 1
Mandatory condition
A pro environmental deed has to
be done
Treatment 2
Voluntary condition
A pro environmental deed is
proposed
(1=Accept; 2=Refuse)
Dictator Game. (Measuring the Willingness to Donate)
Part of the potential earnings to be given in favor of a pro environmental project
9
4. Results
A total of 185 Master students participated in this study, including 123 subjects from business-
related majors (Mean age = 22.70, SEM
5
= 0.20) and 62 students from environmental-related majors
(Mean age = 20.77, SEM
3
= 0.11). All subjects were unfamiliar with experimental economics. Gender
characteristics proved to be well balanced across treatment groups. Below, we summarize our two
main results (figures are presented in table 4).
R1: Intrinsically motivated individuals donated significantly less than non-intrinsically motivated
individuals after a mandatory virtuous act. Difference is significant at the 5% level, t(61)= 2,569,
p=0,012. This supports our first hypothesis H1.
R2: Intrinsically motivated individuals donated significantly more than non-intrinsically motivated
individuals after a voluntary virtuous act. Difference is significant at the 5% level, t(30)= 2,214,
p=0,034. This supports our second hypothesis H2.
Our first main result indicates that licensing effect happened in the mandatory scenario with
intrinsically motivated individuals, whereas our second main result points out that licensing effect
happened in the voluntary scenario with non-intrinsically motivated individuals. In sum, intrinsically
Figure 1. Average willingness to donate to the environmental union under different conditions
5
Standard Error of the Mean
Control Mandatory good deed Voluntary good deed
0
2
4
6
8
10
12
14
16
12,22
13,55
8
9,8
7,04
11,29
Business related ma-
jors
Environmental related
majors
10
and non-intrinsically motivated individuals reacted adversely to the two policy designs. Figure 1
illustrates our findings.
Table 4 summarizes the results. The columns in table 3 correspond to different outcomes (willingness
to donate), each of which is recorded separately among intrinsically vs. non-intrinsically motivated
individuals. The top row reports means for the control group (neither voluntary nor mandatory
virtuous act in a first stage). The next two rows explore means for the treatment one (voluntary
virtuous act first), separating results in two lines: those who refused to commit to the virtuous act
and then, those who accepted to commit. The final row reports means for treatment two
(mandatory virtuous act first).
Table 4. Average willingness to donate to the environmental union and SEM
3
under different
conditions
Environmental related majors
(Intrinsically motivated individuals)
Business related majors
(Non-intrinsically motivated individuals)
Control group
No virtuous act
9,8 (2,354)
12,22 (1,657)
Voluntary condition (Treatment one)
No virtuous act
(refuse)
12,13 (4,23)
10,523 (2,54)
Voluntary
virtuous act
6
10,77 (2,181)
5,21 (1, 448)
7
Mandatory condition (Treatment two)
Mandatory
virtuous act
7,04 (1,884)
13,55 (1,518)
5. Policy implications and conclusion
First of all, our contribution is an additional stone supporting the fact that actions must not be
considered in isolation but as influencing each other. The influence is not only related to the nature
of the action (good versus bad deed) but also the way it is generated. We have shown that the
licensing effect is influenced by the way the ‘virtuous’ act is generated according to whether
individuals are intrinsically motivated or not.
6
Participation rate in the voluntary condition was slightly higher for intrinsically motivated individuals than for non-
intrinsically motivated individuals (62% vs. 50%).
7
We checked for a revenue effect, but low income ratio in this condition is equivalent to the whole sample (low
income= 42% and high income= 58% vs 46% and 54% for the whole sample)
11
The study aimed to experimentally test for conditions that are assumed to influence the licensing
effect. We conclude that the presence of intrinsic motivation and the way the virtuous act is
generated (voluntarily or mandatorily) are two important conditions explaining the occurrence of
licensing effect. We found that intrinsically motivated individuals donated significantly less than non-
intrinsically motivated individuals after a mandatory virtuous act. Conversely, intrinsically motivated
individuals donated significantly more than non-intrinsically motivated individuals after a voluntary
virtuous act. The licensing effect arises when combining intrinsically (non- intrinsically) motivated
individuals and mandatory (voluntary) conditions. Overall, intrinsically and non-intrinsically
motivated individuals reacted adversely to the treatment variables. Mandatory condition does not
work well with intrinsically motivated individuals but it does work well with non-intrinsically
motivated individuals. The voluntary scenario performs better with intrinsically motivated individuals
but licenses non-intrinsically motivated individuals.
The main implication of these findings suggests the need to target policies according to population
subgroups and avoid ‘one-size-fits-all’ policies in the environmental realm. Indeed, it seems
necessary to characterize and elicit whether subgroups of the population are intrinsically motivated
to tailor policy instruments accordingly. Further research may not only suggest methods to avoid
licensing effect, but also hold the promise of helping to design settings that foster tailored policies.
Also, this challenging point may raise equity issues where subgroups would face different
instruments.
References
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Burns, Z., Chiu, A., Wu, G. (2010), “Overweighting of Small Probabilities”, Wiley Encyclopedia of
Operations Research and Management Science, 19pp.
Chang, J., Lai, C. (1999), “Local environmental control and institutional crowding out”, European
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Chen, R., Jia, J. (2005), “Consumer Choices Under Small Probabilities: Overweighting or
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Chiou, W.-B., Wan, C.-S., Wu, W.-H. and Lee, K.-T. (2011), “A randomized experiment to examine
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on the Paper by Frey”, Journal of Consumer Policy, 22 (4), 419-427.
Sachdeva, S., Iliev, R., Medin, D. (2009), “Sinning Saints and Saintly Sinners: The paradox of Moral
Self-Regulation”, Psychological Science, 20 (4), 523-528.
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« Do Good Deeds Make Bad People?»