The construction of social preferences often requires one to reconcile various social motives, such as concern with unfavorable inequality and maximization of social welfare. We propose a novel theory whereby people’s level of agency influences the relative intensities of their social motives, and thus their social preferences. Agency in this context refers to decision makers’ active involvement in the processes that produce social outcomes. Nonagentic decision makers are not involved in creating the outcomes. Therefore, the comparison between self and others is highly informative for them and they shun settings in which their outcome appears to be inferior. Conversely, agentic decision makers, who take action to influence social outcomes, care more about others’ outcomes and are more inclined to promote social welfare. We report five studies testing the agency hypothesis. Participants were presented with realistic scenarios involving outcomes for themselves and another person. In each scenario, the outcome for oneself was fixed, while the outcome for the other person varied. The participants’ task was to indicate their satisfaction with the other person obtaining either the same outcome as their own or a better one. We found that participants who were involved in creating the outcomes (agentic condition) were more satisfied with the other getting the better option than were participants who were not involved (nonagentic condition). Even low levels of influence on the outcomes were sufficient for a strong agency effect to occur. We discuss the agency hypothesis in relation to theories of social preference, the effects of voicing and participation in decision processes, and trade-offs in public policy.