Public Praise vs. Private Pay: Effects of Rewards on Energy Conservation in the Workplace

M.J.J. Handgraaf, M. van Lidth de Jeude, K.C. Appelt

Research output: Working paperAcademic

Abstract

Any solution to rising levels of CO2 depends on human behavior. One common approach to changing human behavior is rewarding desired behavior. Because financial incentives often have side effects that diminish efficacy, we predict that more psychologically oriented social rewards are more effective, because they invoke adherence to descriptive and injunctive social norms. We investigated this by measuring electricity use for 13 weeks at a Dutch firm. Each week, employees were rewarded for conserving energy. They either received monetary rewards (€0-€5) or social rewards (grade points with a descriptive comment). Rewards were either private or public. In both the short and long term, public rewards outperformed private rewards, and social rewards outperformed monetary rewards. This suggests that private monetary rewards, although popular, may be ineffective. Instead, public social rewards may be a more promising approach to stimulating energy conservation. Such social rewards do not crowd out intrinsic motivation, have less need for large-scale institutions or exogenous funding, and work regardless of who is paying the energy bill. Thus, we argue that the social norms approach should be considered more frequently as a valuable tool in the intervention tool-kit, especially when focusing on low-cost environmental behavior.
Original languageEnglish
PublisherSSRN
Publication statusPublished - 2011

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