IDEAS home Printed from https://ideas.repec.org/p/hhs/iuiwop/0453.html
   My bibliography  Save this paper

Social Norms, the Welfare State, and Voting

Author

Listed:
  • Lindbeck, Assar

    (Research Institute of Industrial Economics (IFN))

  • Nyberg, Sten

    (Research Institute of Industrial Economics (IFN))

  • Weibull, Jörgen

    (Research Institute of Industrial Economics (IFN))

Abstract

This paper analyzes the interplay between economic incentives and social norms in a public finance context. We assume that to live off one's own work is a social norm, and that the larger the population fraction adhering to this norm, the more intensely it is felt by the individual. It is shown that this may give rise to multiple equilibria and to non-linearities that do not arise from economic incentives alone. In the model, individuals also vote on taxes and transfers. Hence, the social norm influences both their economic and political behavior. We show that monotone and continuous changes in external factors may result in non-monotone, and even discontinuous, changes in the political equilibrium.

Suggested Citation

  • Lindbeck, Assar & Nyberg, Sten & Weibull, Jörgen, 1996. "Social Norms, the Welfare State, and Voting," Working Paper Series 453, Research Institute of Industrial Economics.
    • Handle: RePEc:hhs:iuiwop:0453
    as

    Download full text from publisher

    File URL: https://www.ifn.se/wfiles/wp/wp453.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Bernheim, B Douglas, 1994. "A Theory of Conformity," Journal of Political Economy, University of Chicago Press, vol. 102(5), pages 841-877, October.
    2. Lindbeck, A., 1994. "Welfare State Disincentives with Endogenous Habits and Norms," Papers 589, Stockholm - International Economic Studies.
    3. George A. Akerlof, 1980. "A Theory of Social Custom, of which Unemployment may be One Consequence," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 94(4), pages 749-775.
    4. Meltzer, Allan H & Richard, Scott F, 1981. "A Rational Theory of the Size of Government," Journal of Political Economy, University of Chicago Press, vol. 89(5), pages 914-927, October.
    5. Lindbeck, Assar, 1995. " Welfare State Disincentives with Endogenous Habits and Norms," Scandinavian Journal of Economics, Wiley Blackwell, vol. 97(4), pages 477-494, December.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Mishkin, Frederic S., 1998. "International Experiences With Different Monetary Policy Regimes," Seminar Papers 648, Stockholm University, Institute for International Economic Studies.
    2. Adrian Chadi, 2012. "Employed But Still Unhappy? On the Relevance of the Social Work Norm," Schmollers Jahrbuch : Journal of Applied Social Science Studies / Zeitschrift für Wirtschafts- und Sozialwissenschaften, Duncker & Humblot, Berlin, vol. 132(1), pages 1-26.
    3. Taylor, John B., 1999. "The robustness and efficiency of monetary policy rules as guidelines for interest rate setting by the European central bank," Journal of Monetary Economics, Elsevier, vol. 43(3), pages 655-679, June.
    4. Lindbeck, A., 1998. "Swedish Lessons for Post-Socialist Countries," Papers 645, Stockholm - International Economic Studies.
    5. John Hassler & José V. Rodríguez Mora & Kjetil Storesletten & Fabrizio Zilibotti, 1998. "Equilibrium unemployment insurance," Economics Working Papers 605, Department of Economics and Business, Universitat Pompeu Fabra, revised Jun 1999.
    6. Robert A. Moffitt, 2003. "The Temporary Assistance for Needy Families Program," NBER Chapters, in: Means-Tested Transfer Programs in the United States, pages 291-364, National Bureau of Economic Research, Inc.
    7. Mari Rege & Kjetil Telle, 2006. "Unaffected Strangers Affect Contributions," Nordic Journal of Political Economy, Nordic Journal of Political Economy, vol. 32, pages 93-112.
    8. Thomas J. Nechyba, 2001. "Social Approval, Values, and AFDC: A Reexamination of the Illegitimacy Debate," Journal of Political Economy, University of Chicago Press, vol. 109(3), pages 637-666, June.
    9. Assar Lindbeck & Sten Nyberg & Jörgen W. Weibull, 1999. "Social Norms and Economic Incentives in the Welfare State," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 114(1), pages 1-35.
    10. Assar Lindbeck, 1996. "Incentives in the Welfare-State," CESifo Working Paper Series 111, CESifo.
    11. Shirit Katav-Herz, 2001. "Social Conformity and Child Labor," Working Papers 2001-14, Bar-Ilan University, Department of Economics.
    12. Mari Rege & Kjetil Telle, 2003. "Indirect Social Sanctions from Monetarily Unaffected Strangers in a Public Good Game," Discussion Papers 359, Statistics Norway, Research Department.
    13. Mari Rege & Kjetil Telle, 2001. "An Experimental Investigation of Social Norms," Discussion Papers 310, Statistics Norway, Research Department.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Lindbeck, Assar, 1997. "Incentives and Social Norms in Household Behavior," American Economic Review, American Economic Association, vol. 87(2), pages 370-377, May.
    2. Fehr, Ernst & Falk, Armin, 2002. "Psychological foundations of incentives," European Economic Review, Elsevier, vol. 46(4-5), pages 687-724, May.
    3. Edward J. Bird, "undated". "Welfare Policy and Endogenous Selective Norms," Wallis Working Papers WP11, University of Rochester - Wallis Institute of Political Economy.
    4. Cartwright, Edward, 2009. "Social norms: Does it matter whether agents are rational or boundedly rational?," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 38(3), pages 403-410, June.
    5. Nyborg, Karine & Rege, Mari, 2003. "On social norms: the evolution of considerate smoking behavior," Journal of Economic Behavior & Organization, Elsevier, vol. 52(3), pages 323-340, November.
    6. Edward J. Bird, "undated". "Social Norms, Cultural Competition, and Welfare Reform: Scant Hope for the Collapsing Family," Wallis Working Papers WP7, University of Rochester - Wallis Institute of Political Economy.
    7. Bergh, Andreas & Bjørnskov, Christian, 2014. "Trust, welfare states and income equality: Sorting out the causality," European Journal of Political Economy, Elsevier, vol. 35(C), pages 183-199.
    8. Edward J. Bird, 1999. "Can Welfare Policy Make Use Of Social Norms?," Rationality and Society, , vol. 11(3), pages 343-365, August.
    9. Eddy Cardinaels & Yuping Jia, 2016. "How Audits Moderate the Effects of Incentives and Peer Behavior on Misreporting," European Accounting Review, Taylor & Francis Journals, vol. 25(1), pages 183-204, May.
    10. Assar Lindbeck & Sten Nyberg & Jörgen W. Weibull, 1999. "Social Norms and Economic Incentives in the Welfare State," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 114(1), pages 1-35.
    11. Balestrino, Alessandro, 2010. "Tax avoidance and the endogenous formation of social norms," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 39(5), pages 601-609, October.
    12. Thomas Aronsson & Tomas Sjögren, 2010. "Optimal income taxation and social norms in the labor market," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 17(1), pages 67-89, February.
    13. Assar Lindbeck, 1996. "Incentives in the Welfare-State," CESifo Working Paper Series 111, CESifo.
    14. Vendrik, Maarten C. M., 2003. "Dynamics of a household norm in female labour supply," Journal of Economic Dynamics and Control, Elsevier, vol. 27(5), pages 823-841, March.
    15. Simon G�chter & Arno Riedl, "undated". "Moral Property Rights in Bargaining," IEW - Working Papers 113, Institute for Empirical Research in Economics - University of Zurich.
    16. H Peyton Young, 2014. "The Evolution of Social Norms," Economics Series Working Papers 726, University of Oxford, Department of Economics.
    17. Victor Hiller, 2014. "Gender Inequality, Endogenous Cultural Norms, and Economic Development," Scandinavian Journal of Economics, Wiley Blackwell, vol. 116(2), pages 455-481, April.
    18. Bottazzi, Laura & Lusardi, Annamaria, 2021. "Stereotypes in financial literacy: Evidence from PISA," Journal of Corporate Finance, Elsevier, vol. 71(C).
    19. Paldam, Martin, 2004. "Introduction to the 2003 European Public Choice Society plenary lectures: The Nordic welfare state--success under stress," European Journal of Political Economy, Elsevier, vol. 20(3), pages 739-742, September.
    20. Benabou, Roland, 2005. "Inequality, Technology and the Social Contract," Handbook of Economic Growth, in: Philippe Aghion & Steven Durlauf (ed.), Handbook of Economic Growth, edition 1, volume 1, chapter 25, pages 1595-1638, Elsevier.

    More about this item

    Keywords

    WELFARE STATE; ETHICS;

    JEL classification:

    • D60 - Microeconomics - - Welfare Economics - - - General
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • D69 - Microeconomics - - Welfare Economics - - - Other

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:hhs:iuiwop:0453. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Elisabeth Gustafsson (email available below). General contact details of provider: https://edirc.repec.org/data/iuiiise.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.