Social Preferences and Public Economics

Linked with Samuel Bowles – USA.

Are good laws a substitute for good citizens?

By Samuel Bowles, Santa Fe Institute and University of Siena1, 14 January, 2007 – Abstract: Laws and policies designed to harness self-regarding preferences to public ends may fail when they compromise the beneficial effects of pro-social preferences. Experimental evidence indicates that incentives that appeal to self interest may reduce the salience of intrinsic motivation, reciprocity, and other civic motives. Motivational crowding in also occurs. The evidence for these processes is reviewed and a model of optimal explicit incentives is presented.

JEL: D64, D52, H41, H21, Z13, C92

Keywords: Social preferences, implementation theory, incentive contracts, incomplete contracts, framing, behavioral experiments, motivational crowding out, ethical norms, constitutions. (full text of this 27 pages).

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