Preferences for Power

Power—the ability to determine the outcomes of others—usually comes with various benefits: higher compensation, public recognition, etc. We demonstrate that a substantial fraction of individuals enjoy the intrinsic value of power: they accept a lower payoff in exchange for power over others, without any additional benefits to themselves. We show that preferences for power exist independently of other components of decision rights. Further, these preferences cannot be explained by social preferences, are stable over time and are not driven by mistakes, misunderstandings or individuals’ signaling intentions. We establish that ignoring preferences for power may have large welfare implications.