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Economic Influences on Moral Values

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  • Östling Robert

    ()
    (Stockholm University)

Abstract

This paper extends standard consumer theory to account for endogenous moral motivation. Building on cognitive dissonance theory, I show how moral values are affected by changes in prices and income. The key insight is that changes in prices and income that lead to higher consumption of an immoral good also affect the moral values held by the consumer so that the good is considered less immoral. A preliminary empirical analysis based on the World Values Survey is consistent with the model's predictions with respect to income.

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Bibliographic Info

Article provided by De Gruyter in its journal The B.E. Journal of Economic Analysis & Policy.

Volume (Year): 9 (2009)
Issue (Month): 1 (January)
Pages: 1-26

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Handle: RePEc:bpj:bejeap:v:9:y:2009:i:1:n:2

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  1. Rabin, Matthew, 1994. "Cognitive dissonance and social change," Journal of Economic Behavior & Organization, Elsevier, Elsevier, vol. 23(2), pages 177-194, March.
  2. Chaloupka, Frank J. & Warner, Kenneth E., 2000. "The economics of smoking," Handbook of Health Economics, Elsevier, in: A. J. Culyer & J. P. Newhouse (ed.), Handbook of Health Economics, edition 1, volume 1, chapter 29, pages 1539-1627 Elsevier.
  3. Roland Bénabou & Jean Tirole, 2003. "Intrinsic and Extrinsic Motivation," Review of Economic Studies, Oxford University Press, vol. 70(3), pages 489-520.
  4. Saffer, Henry & Chaloupka, Frank, 1999. "The Demand for Illicit Drugs," Economic Inquiry, Western Economic Association International, Western Economic Association International, vol. 37(3), pages 401-11, July.
  5. Andreoni, J. & Erard, B. & Feinstein, J., 1996. "Tax Compliance," Working papers, Wisconsin Madison - Social Systems 9610r, Wisconsin Madison - Social Systems.
  6. Linda Babcock & George Loewenstein, 1997. "Explaining Bargaining Impasse: The Role of Self-Serving Biases," Journal of Economic Perspectives, American Economic Association, American Economic Association, vol. 11(1), pages 109-126, Winter.
  7. Lindbeck, Assar, 1997. "Incentives and Social Norms in Household Behavior," Seminar Papers, Stockholm University, Institute for International Economic Studies 622, Stockholm University, Institute for International Economic Studies.
  8. Andrei Shleifer, 2004. "Does Competition Destroy Ethical Behavior?," American Economic Review, American Economic Association, American Economic Association, vol. 94(2), pages 414-418, May.
  9. Roland Bénabou & Jean Tirole, 2004. "Incentives and Prosocial Behavior," Working Papers, Princeton University, Woodrow Wilson School of Public and International Affairs, Discussion Papers in Economics. 137, Princeton University, Woodrow Wilson School of Public and International Affairs, Discussion Papers in Economics..
  10. Samuel Bowles, 1998. "Endogenous Preferences: The Cultural Consequences of Markets and Other Economic Institutions," Journal of Economic Literature, American Economic Association, vol. 36(1), pages 75-111, March.
  11. Ellingsen, Tore & Johannesson, Magnus, 2006. "Pride and Prejudice: The Human Side of Incentive Theory," CEPR Discussion Papers, C.E.P.R. Discussion Papers 5768, C.E.P.R. Discussion Papers.
  12. James Konow, 2000. "Fair Shares: Accountability and Cognitive Dissonance in Allocation Decisions," American Economic Review, American Economic Association, American Economic Association, vol. 90(4), pages 1072-1091, September.
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Cited by:
  1. Martin Halla & Friedrich G. Schneider, 2005. "Taxes and Benefits: Two Distinct Options to Cheat on the State?," Economics working papers, Department of Economics, Johannes Kepler University Linz, Austria 2005-05, Department of Economics, Johannes Kepler University Linz, Austria.
  2. James Alm & Benno Torgler, 2012. "Do Ethics Matter? Tax Compliance and Morality," Working Papers, Tulane University, Department of Economics 1207, Tulane University, Department of Economics.
  3. Nordblom, Katarina & Zamac, Jovan, 2011. "Endogenous Norm Formation Over the Life Cycle – The Case of Tax Evasion," Working Paper Series, Uppsala University, Department of Economics 2011:13, Uppsala University, Department of Economics.
  4. Katarina Nordblom & Jovan Žamac, 2012. "Endogenous Norm Formation Over the Life Cycle – The Case of Tax Morale," Economic Analysis and Policy (EAP), Queensland University of Technology (QUT), School of Economics and Finance, Queensland University of Technology (QUT), School of Economics and Finance, vol. 42(2), pages 153-170, September.

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