A nudge is a non-coercive paternalistic intervention that attempts to improve choices by manipulating the framing of a decision problem. As any paternalism, it faces the difficulty of determining the appropriate welfare criterion. We propose a welfare-theoretic foundation for nudging similar in...

This experimental study investigates how behavior changes after punishment for an unkind action. It also studies how fairness perceptions affect the reaction to punishment and whether this effect is consistent across repeated play and role experiences. A repeated version of the power-to-take...

Policies and explicit private incentives designed for self-regarding individuals sometimes are less effective or even counterproductive when they diminish altruism, ethical norms and other social preferences. Evidence from 51 experimental studies indicates that this crowding out effect is...

This paper seeks to extend the domain of identity economics by exploring motivational foundations of in-group cooperation and out-group competition. On this basis, we explore the reflexive interaction between individual economic decisions and social identities in response to technological change...

First the assumption of self-interest as applied in Economics is presented. Here we also discuss areas in which (many) people behave less self- but more other-regarding than traditional economic models assume. Then, greedy behaviour is considered as existing in the political and economic...

In a family context with endogenous timing, multiple public goods and alternative parental instruments, we show that the optimal timing for the sequential-action game played by rotten kids and a parent depends crucially on whether the kids are homogeneous or heterogeneous. For homogeneous kids,...

A “conservation good” (such as a tropical forest) is owned by a seller who is tempted to consume (or cut), but a buyer benefits more from conservation. The seller does conserve if the buyer is expected to buy, but the buyer is unwilling to pay as long as the seller conserves. This...

We present and test a theory of prospective and retrospective pocketbook voting. Focusing on two large reforms in Sweden, we establish a causal chain from policies to sizeable individual gains and losses and then to voting. The Social Democrats proposed budget cuts affecting parents with young...

We develop a framework for optimal taxation when agents can earn their income both in traditional activities, where private and social products coincide, and in rent-seeking activities, where private returns exceed social returns either because they involve the capture of pre-existing rents or...