Intrinsic Motivation and Altruism under Rational Inattention: Do We Perform Better When We Care?

Abstract

Under the rational inattention framework, we explore the relationship between intrinsic motivation, altruism, information (attention) cost, and decision performance using perceptual tasks. We find counterintuitive results: higher intrinsic motivation leads subjects to perform worse. Furthermore, a high level of altruism is associated with lower decision performance when information acquisition benefits others. These observations are attributed to a positive relationship between altruism, intrinsic motivation, and information cost. Our findings highlight the complex trade-offs between intrinsic motivation, altruism, and cognitive limitations. They challenge the common assumption that increased motivation may lead to better outcomes. Meanwhile, we find that the net expected utility and the cost of information acquisition do not vary across different decision contexts. These results suggest that cognitive constraints may depend less on how subjects are paid and more on how the experiment is designed.