MORALITY Evolutionary Foundations and Policy Implications - PowerPoint PPT Presentation

MORALITY Evolutionary Foundations and Policy Implications Discussion Xavier Giné World Bank

Summary • What preferences would humans have if preferences and moral values were transmitted from generation to generation? • For , Homo moralis • Homo oeconomicus • Homo kantiensis

Example: Public Goods game • FOCs for unique NE for Homo oeconomicus : • Material payoff for Homo kantiensis : • FOCs for unique NE for Homo kantiensis :

Example: Public Goods game • FOCs for unique NE for Homo moralis :

Where does come from? • Alger and Weibull (2013) suggest that is related to the index of assortativity. • Everyone in society shares same preference • Henrich et al.(2004) Foundations of Human Sociality -Violations of Homo oeconomicus - Dispersion across (and within) societies - Pro-social behavior correlated with market integration

Role of Incentives “In contriving any system of government […] every man ought to be supposed a knave, and to have no other end, in all his actions, than private interest. By this interest we must govern him, and, by means of it, make him, notwithstanding his insatiable avarice and ambition, co- operate to public good .” David Hume, 1777 • Mechanism Design: The invisible hand needs a helping hand • In this paper, citizens are not knaves, but can a constitution for knaves produce knaves? – Gneezy and Rustichini (2000) – Gine, Mansuri and Sreshtra (2016) • Literature on the possibility that incentives may 6 undermine moral behavior

Policy Implications • At some level, it is an optimistic paper. – Regulation may not be needed if individuals are “doing the right thing” – But it is unclear that places with higher are the least regulated. • Policies designed for knaves may be ineffective if society is closed to Kantian but will not undermine motivation to contribute to the common good.