Local Environment Control and Institutional Crowding-out

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Local Environment Control and Institutional Crowding-out

Author Info

Juan Camilo Cardenas
John K. Stranlund
Cleve E. Willis

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Abstract

Regulations that are designed to improve social welfare typically begin with the premise that individuals are purely self-interested. Experimental evidence shows, however, that individuals do not typically behave this way; instead, they tend to strike a balance between self and group interests. From experiments performed in rural Colombia, we found that a regulatory solution for an environmental dilemma that standard theory predicts would improve social welfare clearly did not. This occurred because individuals confronted with the regulation began to exhibit less other-regarding behavior and made choices that were more self-interested; that is, the regulation appeared to crowd out other-regarding behavior. Ó 2000 Elsevier Science Ltd. All rights reserved.

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Paper provided by The Field Experiments Website in its series Artefactual Field Experiments with number 0024.

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Length: 15 pages
Date of creation: 2000
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Handle: RePEc:feb:artefa:0024

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Article
- Cardenas, Juan Camilo & Stranlund, John & Willis, Cleve, 2000. "Local Environmental Control and Institutional Crowding-Out," World Development, Elsevier, vol. 28(10), pages 1719-1733, October. [Downloadable!] (restricted)

References listed on IDEAS
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Sunstein, Cass R, 1993. "Endogenous Preferences, Environmental Law," Journal of Legal Studies, University of Chicago Press, vol. 22(2), pages 217-54, June.
James Andreoni & Brian Erard & Jonathan Feinstein, 1998. "Tax Compliance," Journal of Economic Literature, American Economic Association, vol. 36(2), pages 818-860, June. [Downloadable!] (restricted)
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. [Downloadable!] (restricted)

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