Featured Research

from universities, journals, and other organizations

The Economics Of Nice Folks

Date:
June 22, 2008
Source:
Santa Fe Institute
Summary:
A researcher argues in Science that a basic tenet of economics -- that people always behave selfishly -- can be wrong, sometimes badly so. He points to new experimental evidence that people do often act against their own personal self-interest in favor of the common good, and they do so in predictable, understandable ways. Poorly-designed economic institutions fail to take advantage of intrinsic moral behavior and often undermine it.

A basic tenet of economics is that people always behave selfishly, or as the 18th century philosopher economist David Hume put it, "every man ought to be supposed to be a knave."

But what if some people aren't always knaves?

Sam Bowles argues in Science June 20 that economics will get it wrong then, sometimes badly so. He points to new experimental evidence that people do often act against their own personal self-interest in favor of the common good, and they do so in predictable, understandable ways. Poorly-designed economic institutions fail to take advantage of intrinsic moral behavior and often undermine it.

Take this example: Six day care centers imposed a fine on parents who picked their children up late. The effect? Tardiness doubled, and it stayed high even when the fine was removed. Parents, it seems, stopped seeing lateness as an imposition on teachers, and instead saw it as something that could be purchased with no moral failing.

Another example is a study this year which showed that women donated blood less frequently when they were paid for it than when it was an act of charity.

These examples show that economists ignore human altruism at their peril. Standard economic theory assumes that incentives that appeal to self-interest won't affect any natural altruism that may exist, but that assumption is clearly wrong. Bowles discusses the research to date that helps to explain when and why that assumption breaks down.

As the world becomes more interconnected and the resulting challenges to humanity increase, learning to harness these altruistic impulses becomes even more important, Bowles says. So the economists' "holy grail," to learn to design institutions and policies to direct the selfish impulses of individuals to public ends, "will be necessary but insufficient," Bowles says. "The moral nature of humans must also be recognized, cultivated, and empowered."


Story Source:

The above story is based on materials provided by Santa Fe Institute. Note: Materials may be edited for content and length.


Cite This Page:

Santa Fe Institute. "The Economics Of Nice Folks." ScienceDaily. ScienceDaily, 22 June 2008. <www.sciencedaily.com/releases/2008/06/080619142115.htm>.
Santa Fe Institute. (2008, June 22). The Economics Of Nice Folks. ScienceDaily. Retrieved April 23, 2014 from www.sciencedaily.com/releases/2008/06/080619142115.htm
Santa Fe Institute. "The Economics Of Nice Folks." ScienceDaily. www.sciencedaily.com/releases/2008/06/080619142115.htm (accessed April 23, 2014).

Share This



More Science & Society News

Wednesday, April 23, 2014

Featured Research

from universities, journals, and other organizations


Featured Videos

from AP, Reuters, AFP, and other news services

UN Joint Mission Starts Removing Landmines in Cyprus

UN Joint Mission Starts Removing Landmines in Cyprus

AFP (Apr. 23, 2014) The UN mission in Cyprus (UNFICYP) led a mine clearance demonstration on Wednesday in the UN-controlled buffer zone where demining operations are being conducted near the Cypriot village of Mammari. Duration: 01:00 Video provided by AFP
Powered by NewsLook.com
Air Force: $4.2B Saved from Grounding A-10s

Air Force: $4.2B Saved from Grounding A-10s

AP (Apr. 23, 2014) Speaking about the future of the United States Air Force, Chief of Staff Gen. Mark Welsh says the choice to divest the A-10 fleet was logical and least impactful. (April 23) Video provided by AP
Powered by NewsLook.com
Nuclear-Level Asteroids Might Be More Common Than We Realize

Nuclear-Level Asteroids Might Be More Common Than We Realize

Newsy (Apr. 23, 2014) The B612 Foundation says asteroids strike Earth much more often than previously thought, and are hoping to build an early warning system. Video provided by Newsy
Powered by NewsLook.com
High Court to Hear Dispute of TV Over Internet

High Court to Hear Dispute of TV Over Internet

AP (Apr. 22, 2014) The future of Aereo, an online service that provides over-the-air TV channels, hinges on a battle with broadcasters that goes before the U.S. Supreme Court on Tuesday. (April 22) Video provided by AP
Powered by NewsLook.com

Search ScienceDaily

Number of stories in archives: 140,361

Find with keyword(s):
Enter a keyword or phrase to search ScienceDaily for related topics and research stories.

Save/Print:
Share:

Breaking News:
from the past week

In Other News

... from NewsDaily.com

Science News

Health News

Environment News

Technology News



Save/Print:
Share:

Free Subscriptions


Get the latest science news with ScienceDaily's free email newsletters, updated daily and weekly. Or view hourly updated newsfeeds in your RSS reader:

Get Social & Mobile


Keep up to date with the latest news from ScienceDaily via social networks and mobile apps:

Have Feedback?


Tell us what you think of ScienceDaily -- we welcome both positive and negative comments. Have any problems using the site? Questions?
Mobile: iPhone Android Web
Follow: Facebook Twitter Google+
Subscribe: RSS Feeds Email Newsletters
Latest Headlines Health & Medicine Mind & Brain Space & Time Matter & Energy Computers & Math Plants & Animals Earth & Climate Fossils & Ruins