The logic behind this hypothesis is simple and obvious. In the language of game theory, we have to reward cooperation and impose a fine on defection. It’s that simple.

Incentives are rewards that organizations and societies use to motivate us to behave in a certain way. From the perspective of systems thinking, incentives are powerful feedback loops that aim to steer our behavior in a desired direction. Incentives are usually material or moral in nature. Material incentives are usually monetary rewards like bonuses, while moral incentives improve our reputations in the community and make us feel good for having done the right thing.

This can be formulated into our second hypothesis:

Religions provide a clear moral incentive system, but the material rewards and punishments they promise usually come after we die. Christianity, Judaism and Islam all have versions of heaven and hell that await us depending on how we have lived our lives here on Earth. Eastern religions such as Hinduism, Buddhism and Janism use the idea of karma, which rewards or punishes us in our next incarnation based on our actions in this life.

While religions provide us with clear moral incentives, they are unable to back them up with material rewards for following their teachings. The money-driven culture that surrounds all religions provides strong financial incentives for behavior that is often anathema to those teachings. This creates a great conflict in the heart of many religious people, who are torn over whether to follow the incentives that lead to material success in this life or to wait for the rewards they have been promised in the next.

The idea of such cosmic justice, where moral and material incentives finally align, can provide great hope and solace for those who suffer in this life, but they fail to alleviate their suffering in the material world. A more effective incentive system would guarantee more immediate material rewards in addition to the moral benefits.

As systems thinking teaches us, the less delay there is in our feedback loops, the easier it is for us to adjust our behavior, because we can connect an effect to its actual cause. If we can’t connect the rewards to their actual cause, the incentive system is broken.

The actual incentives an organization provides, whatever they may be, are always reflective of the values the organization lives by. Some of these incentives are explicit, some implicit and some are hidden. This means that there can be a big difference between an organization’s stated values and those it actually lives by. When there is a discrepancy between stated values and what we reward in practice, we build an organization founded on hypocrisy.

A good example of this discrepancy can be found in which employees are promoted and for what reasons. An organization can explicitly state that behavior X is what is valued and leads to promotions, when, in fact, it’s behavior Y that is rewarded in practice. The essence of a value system is that we reward behavior that we value and punish behavior that we abhor. Any organization that claims to value one thing but rewards something else entirely will be corrupted by its hypocrisy.

By managing to consistently reward the things we truly value, we live out our values in practice. When we succeed in doing this, over time our society, or the organization in question, will become a manifestation of our values. The more immediate and consistent the rewards we provide are, the easier it is for everybody to live and thrive in accordance with those values. This is why aligning moral and financial incentives is one of the most important tasks we need to accomplish.

Money is perhaps the most direct incentive we know, but thus far we have done a poor job at aligning our values with monetary gain. In an ideal world, good deeds would automatically lead to financial rewards while bad deeds would result in immediate financial penalties. This could be articulated as a wish for instant karma–an idea made famous by John Lennon’s eponymous song. I think we all secretly long for an infinitely just universe.

By building our incentive system correctly, the idea of instant karma doesn’t have to remain a mere wish. We can make it into our reality. The ability to impose a version of instant karma would have an immediate positive effect on our collective behavior. It would quickly teach us not to hurt others and make us see that by benefiting others we also benefit ourselves. If this instant karma were built on financial rewards, it could even be called instant financial karma.

Let’s study what a new incentive system that aligns moral and financial incentives as well as our own and our community’s interests would mean in practice. It would allow us to defer our immediate interests to a later date, when we perhaps need the rewards more than we do today. It would allow us to better balance our own needs with those of our community. This is what allows communities to blossom.

Under our current incentive system, the choice we are often faced with is whether to act selfishly and obtain an immediate financial reward or forgo that reward entirely. In the new incentive system, we are given a choice: Do we want to have our cake now or do we save it for a later date? That makes a really big difference in how we would behave when presented with a choice. Many of us would be in a perfect position to defer our reward for a later date and choose to benefit our community, or somebody from our community who has an immediate need for that particular resource.

We have to see that we cannot live without our community, and by benefiting our community, we also benefit ourselves. Choosing to benefit our community is, in fact, like putting money into a savings account from which we draw when we, in turn, are in need. By recording all the deposits we have made into this account, the incentive system makes sure these deposits can be drawn from at a later date.

While we like to imagine that we are unselfish and it is others who act selfishly, we have to see that every one of us regularly needs to act selfishly and there is nothing inherently bad about taking care of your own needs. The point is that we need to strike a better balance between when to act selfishly and when to act in the interest of others. This incentive system makes striking this balance much easier since when we act in the interest of our community, we only defer the resulting rewards rather than forgo them entirely.

Different phases in life demand access to different resources, which is why in some phases of our lives we can act more altruistically whereas other times demand more selfish behavior from us. When we are young and single, for example, our ability to work is high but our material needs are limited. When we build a family and have young children, our material needs increase at the same time that our disposable time decreases. Different phases in life demand different financial strategies. A single person is perhaps better off deferring their payoff to a later date while new parents need immediate payouts rather than later rewards.

So, what is the ultimate purpose of this new incentive system? Simply put: behavior change.

We want to create a culture in which looking out for our neighbors is as important and beneficial to us as looking out for ourselves. In a world like that, everybody’s quality of life would increase significantly. Under such a system, even the most evil and selfish person would be motivated to do good by everybody else because that would still benefit them the most. Doing bad would not only hurt the community, but also themselves.

When society rewards us only for performing good deeds, the only way we can benefit is by doing more good ourselves. Doing good wouldn’t even be so hard any more, since it wouldn’t entail forgoing the reward, but only deferring it. Delayed return altruism works if there is a guarantee that the delayed payoff will be delivered.

This simple change in incentives would have a transformative effect on the whole planet. It would solve most of our problems and spread well-being far and wide. Without such an incentive system in place, we continue to reward selfish and destructive behavior and fail to reward those who do good by the community. By continuing to live with a broken incentive system, we not only fail to maximize our well-being, we degrade our quality of life to the point that we destroy the planet.

Seeing such a large-scale transformation would be proof that we have managed to align every individual’s interest with those of their community. Creating such an alignment is one of our main objectives and possibly the single greatest innovation we have to offer in this book. Without it, it is difficult to imagine how our communities and our planet as a whole can possibly attain their full potential.