Commitment and incentives: economic behavior under oath.

Summary Driven, in particular, by the rise of experimental economics, the recent literature has highlighted a wide range of situations in which monetary incentives fail to steer behavior in the desired direction. This observation leads to a search for alternative institutional mechanisms that can replace monetary incentives. This article reviews the work inspired by the social psychology of commitment in order to develop non-monetary mechanisms that can affect behavior. This work studies a particular commitment procedure: a truth-telling oath. This procedure has been successfully applied to (1) the problem of hypothetical bias in the revelation of preferences for non-market goods, (2) coordination failures, and (3) the propensity to tell the truth. Taken together, this work confirms the ability of commitment mechanisms to guide the design of non-monetary institutions that can effectively guide economic behavior.