Self-Rewards and Personal Motivation
23 Pages Posted: 6 Jul 2012
Date Written: July 4, 2012
Abstract
Self-administered rewards are ubiquitous. They serve as incentives for personal accomplishments and are widely recommended to increase personal motivation. We show that in a model with time-inconsistent and reference-dependent preferences, self-rewards can be a credible and effective tool to overcome self-control problems. We also characterize the type of self-rewards that can be used, such as vice goods and virtue goods, and analyze which types of goods will be preferred by the individual.
Keywords: Quasi-hyperbolic discounting, reference-dependent preferences, loss aversion, self-control, self-rewards, goals
JEL Classification: D03, D81, D91
Suggested Citation: Suggested Citation
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