Samuel Bowles — When economic incentives crowd in social preferences

Explicit economic incentives – for example, a subsidy to contribute to a public good – can sometimes ‘crowd out’ generous and ethical motives. But when properly designed, can incentives ‘crowd in’ these civic virtues? This column uses an example from ancient Athens to show how this might be done, providing a lesson for modern mechanism design and public policy.

Is there a close connection between morality and economics. Bowles suggests so, based Aristotle and ancient Athens.

Voxeu
When economic incentives crowd in social preferences
Samuel Bowles | Research Professor and Director of the Behavioral Sciences Program, Santa Fe Institute