Constitutional Economics and Public Institutions
Show Less

Constitutional Economics and Public Institutions

Edited by Francisco Cabrillo and Miguel A. Puchades-Navarro

This extensive book explores in detail a wide range of topics within the public choice and constitutional political economy tradition, providing a comprehensive overview of current work across the field.
Buy Book in Print
Show Summary Details
You do not have access to this content

Chapter 17: Awards play an important role

Bruno S. Frey and Susanne Neckermann


Awards in the form of orders, decorations, prizes, and titles, are predominantly non-material, but extrinsic incentives. They thus differ from both intrinsic incentives and extrinsic incentives in the form of money. Awards have existed in all centuries, and are used in all countries and in all areas of society, including the private sector of the economy. There are major differences between awards and monetary compensation: _ The material costs of awards, consisting of a certificate or a small trophy, are typically low for the donors, but the value to the recipients may be very high. _ Accepting an award establishes a special relationship, in which the recipient owes (some measure of) loyalty to the donor. This is not true for monetary compensation. _ Due to their vague nature, awards are more adequate incentive instruments than monetary payments when the recipient’s performance can only be vaguely determined. _ Awards are less likely to crowd out the intrinsic motivation of their recipients than monetary compensation. _ Awards are not taxed, while monetary income is.

You are not authenticated to view the full text of this chapter or article.

Elgaronline requires a subscription or purchase to access the full text of books or journals. Please login through your library system or with your personal username and password on the homepage.

Non-subscribers can freely search the site, view abstracts/ extracts and download selected front matter and introductory chapters for personal use.

Your library may not have purchased all subject areas. If you are authenticated and think you should have access to this title, please contact your librarian.

Further information

or login to access all content.