12 The Crowding out Objection - Markets without Limits: Moral Virtues and Commercial Interests by Jason F. Brennan, Peter Jaworski - #virtùperduta #donatoridisange #aritmeticapazza #voti&applausi #nobelconassegno #trasfigurazionedelsoldo
certain markets crowd out or reduce our intrinsic motivation. The complaint is that people are motivated to do certain things for their own sake.Read more at location 2464
there is a great deal of work that has already been done on the market for labor, and on different compensation schemes.Read more at location 2468
It seems like commonsense economics that as you offer workers more money, you should see an increase in the quantity of workRead more at location 2471
What social psychologists call the “overjustification effect” and what economists call the “crowding-out effect” sometimes works against this expected result.Read more at location 2474
paying more leads to getting less. Sometimes, introducing an external financial reward where once there was none can lead to less of the desired behavior.Read more at location 2475
Suppose you see a sign at your workplace asking you to donate blood. The sign tells you that there is a shortage of blood,Read more at location 2480
At the blood bank, you notice that the staff are handing out checks for $25 to the people who donate blood. “That’s great!” some economists might say. You now have two reasonsRead more at location 2483
When we have two reasons to do something, sometimes, instead of the two reasons adding up, we get one reason replacing the other.Read more at location 2488
Control: Imagine having the following internal monologue. “Why am I planning to give blood?” you might ask yourself. The answer you want to give is “because I’m moved by the plight of others, because I want to help,Read more at location 2493
rather than changing our motivation, which remains constant, the framing hypothesis seeks to explain the overjustification effect by suggesting that certain cues can alter what we take to be the appropriate method or procedure for making decisions. The relevant question becomes “what kind of a situation is this?” rather than, “who’s in charge here?” or “what does this say about me?”Read more at location 2516
presenting the Bible to subjects prior to an economic game results in players making fairer offers, or playing in less selfish ways.Read more at location 2522
Within a business frame, standard economic cost-benefit analysis and calculation dominates.Read more at location 2531
possibility of paying for reading. Sandel might worry that the overjustification effect may trump our intrinsic motivationRead more at location 2537
compensation for reading can frame the reading as an instrumental tool in the pursuit of the real end, that of getting paid. And once we’re in a homo economicus mood, we then might be less prone to enjoy reading for its own sake.Read more at location 2539
Elizabeth Anderson6 describes the siting of a nuclear waste facility as another example of the overjustification effect or a framing effect in action.Read more at location 2544
to keep in mind what the anti-commodification thesis claims. The claim is not that there are better and worse ways of having a market in blood,Read more at location 2551
thesis is the claim that there are some things that should not be bought and sold;Read more at location 2553
If we could show that there’s a way of having a market in kidneys, for example, that avoids all of the objections anti-commodification theorists offer, then that would effectively undermine the anti-commodification viewRead more at location 2557
We would reduce the anti-commodification thesis about how kidneys are not commodities at all, to a business ethics thesis about how best to sell a kidney.Read more at location 2559
Judy Cameron conducted two separate meta-analyses on the overjustification effect with a different co-author for each.Read more at location 2563
crowding-out effect of extrinsic rewards, like money, on intrinsic interest and creativity was only observable “under highly restricted, easily avoidable conditions.”Read more at location 2568
“easily attainable using procedures derived from behavior theory.” This work, however, has been challenged.Read more at location 2570
Psychologists and economists working on these fields point out that the overjustification effect obtains under certain very specific conditions.Read more at location 2578
Bruno S. Frey explains that we can expect a crowding-out effect when the external reward is regarded by the subject as “controlling” their behavior.Read more at location 2579
On this view, not all external rewards undermine intrinsic motivation. Verbal rewards can be perceived as informational (as applauding competence, for example) or as controlling. Grades can be “controlling” when a student perceives herself as studying and reading purely or primarily for the sake of the grade.Read more at location 2585
students can internalize the reward system and thereby maintain or enhance their intrinsic motivation.12 Grades can be regarded as a symbol of achievement,Read more at location 2588
David Rosenfield, Robert Folger, and Harold F. Adelman found that intrinsic motivation declined when presented with an external reward, unless the reward was seen to reflect competence.Read more at location 2590
at best, the crowding effect can support the view that we shouldn’t pay people like this or like that, but it cannot underwrite the claim that we ought not compensate people for something or other at all.Read more at location 2599
despite identical payoff structures, M. Pillutla and X. P. Chen managed to get more cooperation when a dilemma was framed in a noneconomic way,Read more at location 2603
Charities often attempt to loosen our grip on our wallets by making use of devices that put us in a charitable and caring frame of mind.Read more at location 2607
Mellstrom and Johannesson discovered that a sum of money paid to women for blood donation lowered willingness to donate blood.15 But they also found that the effect disappeared when they paid in the form of a charitable donation to a charity of the subject’s choice.Read more at location 2615
Awards function similarly. For some kind of awards, a financial component may seem less than fitting.Read more at location 2620
Consider several general kinds of possible awards: an award for exceptionally fulfilling one’s civic duty,Read more at location 2622
In each of these cases, if the award is coupled with some kind of financial compensation, we can predict that the meaning of the award may be sullied or profaned.Read more at location 2623
Nobel Prize for literature comes with a cool one million dollars. And yet, no one believes this prize is less meaningful, less significant, or profanedRead more at location 2625
Michael Sandel received the Harvard-Radcliffe Phi Beta Kappa award for undergraduate teaching.Read more at location 2626
Finally, and most illustratively, consider the Museum of the City of New York award for improving the quality of life of city residents.Read more at location 2629
If all that is true, then notice that Sandel’s Oxford professor who objected to a monetary tip from a student applied one particular interpretive heuristic to the tip,Read more at location 2645
When, in the movie A Beautiful Mind, John Nash is given pens from fellow professors at the Princeton Faculty Club, the ritual is suffused with meaning.Read more at location 2647
The very same can be done with a gift of money for reading, if it were surrounded by some kind of ritual or ceremony that helped the child see the significance of the reward as symbolically more meaningful than the sum.Read more at location 2652
Carruthers and Espeland explain that “[l]ike all other social objects, money has meaning that depends on its use and context.Read more at location 2654
Using Wittgenstein’s views on language, they argue that, “[t]he meaning of money, like the meaning of words, cannot be reduced to that which it represents.Read more at location 2656
They discovered that how much and when you are paid are not the only variables that can impact effort, satisfaction, and performance. According to them, “who distributes the monetary reward, why the reward is distributed, how the reward is distributed, and who receives it” all matter in creating symbolic meanings that can further motivate employees, and give them greater job satisfaction.Read more at location 2663
While employers may ritualize the payment of bonuses and make a ceremony of certain kinds of compensation, we have a set of different kinds of markets with long-standing histories and traditions.Read more at location 2682
The Ascending-bid auction, which is also called an English auction, involves a seller who “gradually raises the price, bidders drop out until finally only one bidder remains, and that bidder wins the object at this final price.” Descending-bid auctions, also called Dutch auctions, involve a seller who “gradually lowers the priceRead more at location 2685
There are First-price sealed-bid auctions, where bidders write their bid and place it in an envelope,Read more at location 2688
Second-price sealed-bid auction, also called a Vickrey auction, which functions the very same as the First-price sealed-bid auction except that the highest bidder gets the item while paying the second-highest bid.Read more at location 2690
All-pay auction, where bidders submit a bid, the highest bidder gets the auctioned item, but all bidders pay.Read more at location 2692
Arjan Appadurai, for example, insists that “[a]uctions accentuate the commodity dimension of objects (such as paintings) in a manner that might well be regarded as deeply inappropriate in other contexts.”Read more at location 2699
Charles W. Smith,23 an economic sociologist who produced the seminal work on the sociology of auctions.Read more at location 2709
for those of us on the outside looking in, as spectators, all we see is a crass battle of self-interested buyers trying to outbid each other. But for the participants to auctions, the kind of auction, the physical location, the particular participants, and how it’s done all combine for a deeply meaningful performance, a performance that sometimes accentuates the commodity dimension of objects, but often times decommodifies those dimensions in the act of auctioning off an object.Read more at location 2710
Smith calls the “social structure” of auctions is similar to what we call the time, place, and manner of markets: “… the influence of time, place, and situation, and the importance of past and ongoing practices, all play a role in establishing values.”Read more at location 2720
Rather than “accentuate the commodity aspect” of an item, auctions help us navigate deeply ambiguous and difficult translations of object to financial price.Read more at location 2725
agricultural commodity exchange auctions, there is an expectation that the big buyers buy up stock of the commodity at a certain price despite the fact that market forces would drop that price lower.Read more at location 2729
What’s more “[t]hese social, psychological, and environmental complexities of real auctions”—what we’re calling the time, place, and manner of markets—“reveal the limitations and fallacies implicit within the neoclassical economic model”Read more at location 2732
anti-commodification theorists argue that something or other is incompatible with markets, they ignore the fact that there are many different ways of designing a market.Read more at location 2738
Andrej Rus, “gifts are held to be inalienable: a gift is not just ‘a watch’ but ‘a-watch-that-myfather-gave-me-for-my-birthday’.”Read more at location 2761
distinction between gift and commodity exchanges does not track the distinction between market and non-market exchanges.Read more at location 2766
Earlier, we pointed out, relying on the work of Zelizer, that money can sometimes function as a gift.Read more at location 2767
Closer to the mark, however, bonuses and other modes of payment delivered in a particular manner can be regarded and perceived by recipients as calling for reciprocity and gratitude,Read more at location 2768
The same can be said of the market in organs in Iran. Here in the west, many see the commodification of organs. In the eyes of the kidney sellers in Iran, however, they perceive themselves as acting altruistically,Read more at location 2772
There may be a useful distinction between gifts and commodities, but that distinction does not distinguish markets from non-markets.Read more at location 2781
“if kidneys are not commodities, then we cannot have a market in kidneys.”Read more at location 2784
Rather than paying students directly for good grades, he tried paying them for engaging in good study habits. He also tried setting out small, concrete goals that students could reasonably reach in a week, and then paid students, teachers, and parents when the students met these weekly goals. Here the results were much more positive.Read more at location 2790
In an earlier study co-authored with David Austen-Smith, Fryer discovered that black and Hispanic students had a strong social disincentive against performing well in school.Read more at location 2794
for blacks and Hispanics, getting above average grades tends to cause them to become less popular.Read more at location 2797
There’s little here for the market to crowd out or corrupt. If Fryer’s experiments work, at best, he’ll get students to learn to love reading for its own sake. A second best result is that he’ll at least get them to read.Read more at location 2807
Note: SECOND BEST
