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Bounded Rationality of Individual Action in the Consumption of Public Goods

Author

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  • Meričková Beáta Mikušová

    (Faculty of Economics, Matej Bel University, Banská Bystrica, Slovakia.)

  • Muthová Nikoleta Jakuš

    (Faculty of Economics, Matej Bel University, Banská Bystrica, Slovakia.)

Abstract

In order to gain a better understanding of human behaviour, Economics seeks to work with other disciplines such as Psychology, Sociology, or Anthropology (Behavioural Economics). Unlike neoclassical economic theory, behavioural economics does not assume a rational individual. On the contrary, it focuses on an irrational (bounded rational) individual while revealing what really influences his decision and his actions in order to respond more adequately to public needs, increasing the efficiency of public-service provision. The aim of the paper is to investigate the factors of willingness to pay for public services. The willingness of individuals to pay depends on factors such as affection and sympathy, conviction, compassion, regret, respect, warm glow, commitment to society, appreciation, invitation to participation, fundraising method and tax policy. The significance of the research conclusions lies in initiating a new perspective on the possibilities of securing public services.

Suggested Citation

  • Meričková Beáta Mikušová & Muthová Nikoleta Jakuš, 2019. "Bounded Rationality of Individual Action in the Consumption of Public Goods," NISPAcee Journal of Public Administration and Policy, Sciendo, vol. 12(2), pages 157-194, December.
    • Handle: RePEc:vrs:njopap:v:12:y:2019:i:2:p:157-194:n:7
    DOI: 10.2478/nispa-2019-0018
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    More about this item

    Keywords

    Factors; MINDSPACE concept; public goods; public services; willingness to pay;
    All these keywords.

    JEL classification:

    • C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments
    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • D64 - Microeconomics - - Welfare Economics - - - Altruism; Philanthropy; Intergenerational Transfers
    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods

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