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Preferences as Human Capital: Rational Choice Theories of Endogenous Preferences and Socioeconomic Changes

  • Maria Saez-Marti


    (IEW University of Zurich)

  • Fabrizio Zilibotti

    (University of Zurich and CEPR)

We discuss the theoretical and empirical foundations of modern economic theories of cultural transmission. The importance of cultural factors in shaping economic and social transformations has been the focus of a long-standing debate in social sciences since the XIXth Century. Neoclassical economics has remained at the marging of this debate. However, there has been a recent surge of interest among economists for cultural factors. The economic models of cultural transmission borrow the main ideas from the anthropological literature, but endogeneize the efforts parents exert to transmit specific cultural variants or preference parameters. We distinguish between paternalistic models where parents use their own values to evaluate their children’s utility, and non-paternalistic or utilitarian models in which parents choose their children’s preferences to maximize the children’s well-being. We discuss recent examples, focusing in particular on corruption, patience, and work ethic.

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Article provided by Finnish Economic Association in its journal Finnish Economic Papers.

Volume (Year): 21 (2008)
Issue (Month): 2 (Autumn)
Pages: 81-94

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Handle: RePEc:fep:journl:v:21:y:2008:i:2:p:81-94
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  1. Sáez-Martí, María & Sjögren, Anna, 2005. "Peers and Culture," Working Paper Series 642, Research Institute of Industrial Economics.
  2. John M. Barron & Mark C. Berger & Dan A. Black, 2006. "Selective Counteroffers," Journal of Labor Economics, University of Chicago Press, vol. 24(3), pages 385-410, July.
  3. repec:tpr:qjecon:v:123:y:2008:i:2:p:747-793 is not listed on IDEAS
  4. Matthias Doepke & Fabrizio Zilibotti, 2007. "Occupational Choice and the Spirit of Capitalism," NBER Working Papers 12917, National Bureau of Economic Research, Inc.
  5. James J. Heckman, 1999. "Policies to Foster Human Capital," NBER Working Papers 7288, National Bureau of Economic Research, Inc.
  6. Bisin, Alberto & Verdier, Thierry, 2001. "The Economics of Cultural Transmission and the Dynamics of Preferences," Journal of Economic Theory, Elsevier, vol. 97(2), pages 298-319, April.
  7. Raquel Fernandez & Alessandra Fogli, 2005. "Fertility: The Role of Culture and Family Experience," Working Papers 05-14, New York University, Leonard N. Stern School of Business, Department of Economics.
  8. Maria Sáez-Martí & Yves Zenou, 2007. "Cultural transmission and discrimination," IEW - Working Papers 348, Institute for Empirical Research in Economics - University of Zurich, revised Apr 2012.
  9. Becker, Sascha O. & Woessmann, Ludger, 2007. "Was Weber Wrong? A Human Capital Theory of Protestant Economic History," IZA Discussion Papers 2886, Institute for the Study of Labor (IZA).
  10. James J. Heckman & Jora Stixrud & Sergio Urzua, 2006. "The Effects of Cognitive and Noncognitive Abilities on Labor Market Outcomes and Social Behavior," Journal of Labor Economics, University of Chicago Press, vol. 24(3), pages 411-482, July.
  11. James Heckman & Flavio Cunha, 2007. "The Technology of Skill Formation," American Economic Review, American Economic Association, vol. 97(2), pages 31-47, May.
  12. Giuliano, Paola, 2006. "Living Arrangements in Western Europe: Does Cultural Origin Matter?," IZA Discussion Papers 2042, Institute for the Study of Labor (IZA).
  13. Botticini, Maristella & Eckstein, Zvi, 2004. "Jewish Occupational Selection: Education, Restrictions or Minorities?," CEPR Discussion Papers 4604, C.E.P.R. Discussion Papers.
  14. Hauk, Esther & Saez-Marti, Maria, 2002. "On the Cultural Transmission of Corruption," Journal of Economic Theory, Elsevier, vol. 107(2), pages 311-335, December.
  15. Carneiro, Pedro & Heckman, James J., 2003. "Human Capital Policy," IZA Discussion Papers 821, Institute for the Study of Labor (IZA).
  16. Botticini, Maristella & Eckstein, Zvi, 2006. "From Farmers to Merchants, Voluntary Conversions and Diaspora: A Human Capital Interpretation of Jewish History," CEPR Discussion Papers 5571, C.E.P.R. Discussion Papers.
  17. repec:tpr:qjecon:v:112:y:1997:i:3:p:729-58 is not listed on IDEAS
  18. Matthias Doepke & Fabrizio Zilibotti, 2005. "Social Class and the Spirit of Capitalism," Journal of the European Economic Association, MIT Press, vol. 3(2-3), pages 516-524, 04/05.
  19. Nicholas, Tom, 1999. "Clogs to Clogs in Three Generations? Explaining Entrepreneurial Performance in Britain Since 1850," The Journal of Economic History, Cambridge University Press, vol. 59(03), pages 688-713, September.
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