Social Preferences: A Foundation of Cooperation, Competition, and Incentives
May 7, 2009
This lecture examined how the consideration of social preferences affects economic outcomes. For a long time, the behavioral sciences - including economics - have largely neglected people's social motives. However, evidence suggests that a substantial number of people exhibit social preferences, which means they are not solely motivated by material self-interest but also care positively or negatively about the material payoffs to other persons. Evidence presented indicates that economists fail to understand fundamental economic questions when they disregard social preferences. In particular, when social preferences are ignored, it is not possible to adequately understand (i) the effects of competition on market outcomes, (ii) the forces governing cooperation and collective action, (iii) the effects and the determinants of material incentives, (iv) which contracts and property rights arrangements are optimal, and (v) important forces shaping social norms and market failures.
Program
- Ernst Fehr (University of Zurich) and Urs Fischbacher (University of Zurich)
Psychological Foundations of Incentives
- Ernst Fehr (University of Zurich) and Armin Falk (University of Zurich)
On the Economics and Biology of Trust
- Ernst Fehr (University of Zurich)