How Our “Better Angels” Can Affect Economic Decisions

Institute for Business & Social Impact

By Ernesto Dal Bó

Do moral ideas have power? We would like to think so. We all appeal to certain actions being “right” as a way to justify why we want certain things done. And implicitly, we expect those moral appeals  to carry force, to disarm opposition, to persuade, and to drive changes in the concrete world of policy, conflict, jobs, and money.

The ubiquitous nature of moral appeals can be puzzling to an economist: We have traditionally assumed that we live in a material world, and that material incentives are the most powerful driver of actions.

That said, behavioral economics and the exploration of non-material motivations have taught us much over the past two decades. Economists now accept the fact that individuals can be altruistic, and that they are sensitive to the intentions and motivations of those with whom they interact. We have learned that we are highly social…

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