What is it about?

How do incentives and social relationships interact? When and why do incentives backfire? How can incentives shift relationships? We offer a framework for systematically thinking about and studying the interactions between incentives and relationships (4 relational models, which fit 4 incentive schemes). We demonstrate how incentives can be used to shift relations to a new mode. We also argue why focusing on the incentive means (especially the distinction between non-monetary vs. monetary incentives) may be less important for understanding incentive backfiring effects than focusing on the schemes (the structure of the incentive). When the schemes fit the relational structure, incentives are effective. When they are incongruent, we see backfiring effects on effort and the relationship.

Featured Image

Why is it important?

Our life is built around coordinating efforts with others – at home, at work, and in our neighborhoods and communities. We commonly incentivize others to do things, while also aiming to sustain and shape our relationships with them. Getting incentives right has important implications for productivity and human wellbeing. This theory provides a framework for studying incentives and social relations, yielding many interesting predictions for future empirical research to test.


While this paper integrates and extends a substantive body of literature across many different fields (e.g., anthropology, psychology, economics, management), I am particularly excited about the new avenues of research that it will hopefully open. Applications range from "classic" topics such as relationships, incentives, contracts, and sorting into organizations, to newer areas such as online community management and the provision of digital public goods.

Prof. Jana Gallus
University of California Los Angeles

Read the Original

This page is a summary of: Relational incentives theory., Psychological Review, October 2021, American Psychological Association (APA),
DOI: 10.1037/rev0000336.
You can read the full text:



The following have contributed to this page