Incentives and spillovers in R&D activities: an agency-theoretic analysis of industry-university relations

In this paper, I study industry-university relations in a principal- agent framework. Following the existing literature, these relations are interpreted in two ways: (1) as occurring through spillovers of knowledge among different groups of researchers, working for different institutional settings; or (2) as more formal interactions, through the possibility, for a scientist, to directly respond to incentives defined by the different communities she may belong to. I formalize these two configurations in a unified framework. I account for: (1) the inherent difficulty in measuring the impact of scientific activities; and (2) the multiplicity of activities that scientists perform. I combine multi-task agency models with distorted performance measures and common agency models. My model identifies several types of incongruities between an agent's actions and the desired outcomes. These incongruities derive also from the strategic interaction among the principals. I also identify some potentially distortionary behavioral effects of the presence of spillovers.Economics of Science; Agency Theory; Industry-University Relations; Science Policy; R&D Management.

Moral NIMBY-ism? Understanding Societal Support for Monetary Compensation to Plasma Donors in Canada

The growing demand for plasma, especially for the manufacture of therapeutic products, prompts discussions on the merits of different procurement systems. We conducted a randomized survey experiment with a representative sample of 826 Canadian residents to assess attitudes toward legalizing payments to plasma donors, a practice that is illegal in several Canadian provinces. We found no evidence of widespread societal opposition to payments to plasma donors. On the contrary, over 70% of respondents reported that they would support compensation. Our Canadian respondents were more in favor of paying plasma donors elsewhere than in Canada, but the differences were small, suggesting a weak role for moral "NIMBY-ism" or relativism. Moral concerns were the respondents' main reason for opposing payments, together with concerns for the safety of plasma from compensated donors, although most of the plasma in Canada does come from paid U.S. donors. Among those in favor of legalizing payments to donors, the main rationale was to guarantee a higher domestic supply. Finally, roughly half of those who declared to be against payments reported that they would reconsider their position if domestic supply plus imports did not cover domestic demand. Most Canadians, therefore, seem to espouse a consequentialist view on issues related to the procurement of plasma

Motivating Altruism: A Field Study

This paper analyzes the effects of a legislative provision that grants a one-day paid leave of absence to blood donors who are employees in Italy. The analysis is based on a unique dataset with the complete donation histories of the blood donors in an Italian town. The cross-sectional variation in job market status and type of employers, and job switching over time by a subset of donors, are the sources of variation we employ to study whether donors are responsive to the paid-day-off incentive in the choice of their donation days, and in the frequency of their donations. Our results indicate that economic considerations do affect blood donation decisions, for donors donate in days of the week that, given the day-off benefit, maximize their material returns in terms of consecutive days off work. We also find evidence, however, consistent with heterogeneous motivations in different donors, since a subset of donors systematically do not take advantage of the material reward. Finally, we find that the day-off privilege leads donors who are employees to make, on average, one extra donation per year. We discuss the implications of our findings for policies aimed at increasing the supply of blood, and more generally for incentivizing pro-social behavior.incentives, altruism, public good provision, pro-social behavior, public health

Social Image Concerns and Pro-Social Behavior

Using longitudinal data on the entire population of blood donors in an Italian town, we examine how donors respond to an award scheme which rewards them with “medals” when they reach certain donation quotas. Our results indicate that donors significantly increase the frequency of their donations immediately before reaching the thresholds for which the rewards are given, but only if the prizes are publicly announced in the local newspaper and awarded in a public ceremony. The results are robust to several specifications, sample definitions, and controls for observable and unobservable heterogeneity. Our findings are consistent with social image concerns being a primary motivator of pro-social behavior, and indicate that symbolic prizes are most effective as motivators when they are awarded publicly. Because we do not detect a reduction in donation frequency after the quotas are reached, this incentive based on social prestige leads to a net increase in the frequency of donations.incentives, awards, public good provision, pro-social behavior, public health, social prestige

Incentives for prosocial activities

Early studies often found that offering economic incentives for undertaking prosocial and intrinsically motivated activities can crowd out motivation to perform these activities. More recent work highlights nuanced and important features related to whether crowding out (or substitution) is likely to occur. In many cases, incentives succeed in encouraging more prosocial behavior and are also cost-effective. However, although the substitution of external incentives for intrinsic motivation may not be a concern in many contexts, the substitution of one prosocial activity for another or shifts in activities over time or location may warrant further attention

Rewarding Altruism? A Natural Field Experiment

We present evidence from a natural field experiment involving nearly 100,000 individuals on the effects of offering economic incentives for blood donations. Subjects who were offered economic rewards to donate blood were more likely to donate, and more so the higher the value of the rewards. They were also more likely to attract others to donate, spatially alter the location of their donations towards the drives offering rewards, and modify their temporal donation schedule leading to a short-term reduction in donations immediately after the reward offer was removed. Although offering economic incentives, combining all of these effects, positively and significantly increased donations, ignoring individuals who took additional actions beyond donating to get others to donate would have led to an under-estimate of the total effect, whereas ignoring the spatial effect would have led to an over-estimate of the total effect. We also find that individuals who received a reward by surprise were less likely to donate after the intervention than subjects who received no reward, suggesting that for some individuals a surprise reward adversely affected their intrinsic motivations. We discuss the implications of these findings for understanding pro-social behavior.

WILL THERE BE BLOOD? INCENTIVES AND SUBSTITUTION EFFECTS IN PRO-SOCIAL BEHAVIOR*

We present evidence from observational data on nearly 14,000 American Red Cross blood drives and from a randomized natural field experiment showing that economic incentives have a positive effect on blood donations without increasing the fraction of donors who come to a drive but are ineligible to donate. We also show that the effect of incentives on donations increases with the incentive's economic value. However, we further show that a substantial proportion of the increase in donations due to incentives may be explained by donors leaving neighboring drives without incentives to attend the drive with incentives, and the likelihood of this substitution is higher the higher the monetary value of the incentive offered. We conclude that extrinsic incentives stimulate pro-social behavior, but, unless substitution effects are also considered, the effect of incentives may be overesti mated.

Will There Be Blood? Incentives and Substitution Effects in Pro-social Behavior

We examine how economic incentives affect pro-social behavior through the analysis of a unique dataset with information on more than 14,000 American Red Cross blood drives. Our findings are consistent with blood donors responding to incentives in a "standard" way; offering donors economic incentives significantly increases turnout and blood units collected, and more so the greater the incentive's monetary value. In addition, there is no disproportionate increase in donors who come to a drive but are ineligible to donate when incentives are offered. Further evidence from a small-scale field experiment corroborates these findings and confirms that donors are motivated by the economic value of the items offered. We also find that a substantial fraction of the increase in donations due to incentives may be explained by donors substituting away from neighboring drives toward drives where rewards are offered, and the likelihood of this substitution is higher the higher the monetary value of the incentive offered and if neighboring drives do not offer incentives. Thus, extrinsic incentives motivate pro-social behavior, but unless substitution effects are also considered, the effect of incentives may be overestimated.incentives, altruism, public good provision, pro-social behavior, public health

Motivating altruism: a field study

This paper analyzes the effects of a legislative provision that grants a one-day paid leave of absence to blood donors who are employees in Italy. The analysis is based on a unique dataset with the complete donation histories of the blood donors in an Italian town. The cross-sectional variation in job market status and type of employers, and job switching over time by a subset of donors, are the sources of variation we employ to study whether donors are responsive to the paid-day-off incentive in the choice of their donation days, and in the frequency of their donations. Our results indicate that economic considerations do affect blood donation decisions, for donors donate in days of the week that, given the day-off benefit, maximize their material returns in terms of consecutive days off work. We also find evidence, however, consistent with heterogeneous motivations in different donors, since a subset of donors systematically do not take advantage of the material reward. Finally, we find that the day-off privilege leads donors who are employees to make, on average, one extra donation per year. We discuss the implications of our findings for policies aimed at increasing the supply of blood, and more generally for incentivizing pro-social behavior

Do all material incentives for prosocial activities backfire? The response to cash and non-cash incentives for blood donations

Experimental studies document that financial rewards discourage the performance of altruistic activities, because they destroy intrinsic altruistic motivations. We set up a randomized-controlled experiment, through a survey administered to 467 blood donors in an Italian town, and find that donors are not reluctant to receive compensation in general: A substantial share of respondents declared they would stop being donors if paid a small amount of cash, but we do not find such effects when a voucher of the same nominal value is offered instead. The aversion to direct cash payments is particularly marked among women and older respondents, while there are neither gender nor age differences in the response to the voucher. Implications for research and public policy are discussed