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Journal of Economic Behavior and OrganizationVolume 126, 1 June 2016, Pages 25-57

Striving for balance in economics: Towards a theory of the social determination of behavior(Article)(Open Access)

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  • aWorld Bank, United States
  • bColumbia University, United States

Abstract

This paper is an attempt to broaden economic discourse by importing insights into human behavior not just from psychology, but also from sociology and anthropology. Whereas in standard economics the concept of the decision-maker is the rational actor, and in early work in behavioral economics it is the quasi-rational actor influenced by the context of the moment of decision, in some recent work in behavioral economics, the decision-maker could be called the enculturated actor. This actor's preferences, perception, and cognition are subject to two deep social influences: (a) the social contexts to which he has become exposed and, especially, accustomed; and (b) the cultural mental models-including categories, identities, narratives, and worldviews-that he uses to process information. The paper traces how these factors shape behavior through the endogenous determination of preferences and the lenses through which individuals see the world-their perception and interpretation of situations. The paper offers a tentative taxonomy of the social determinants of behavior and describes the results of controlled and natural experiments that only a broader view of these determinants can plausibly explain. The perspective suggests more realistic models of human behavior for explaining outcomes and designing policies. © 2016 .

Author keywords

Behavioral economicsCultureFramingGenderRole modelSociology

Funding details

Funding sponsor Funding number Acronym
Ford Foundation
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Roosevelt Institute
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Bernard and Irene Schwartz Foundation
John D. and Catherine T. MacArthur FoundationJDCTMF
  • 1

    Paper prepared for the 2015 meetings of the American Economic Association, Boston, January 3. Hoff is a Lead Economist in the World Bank and was co-director of the World Development Report 2015: Mind, Society and Behavior. Stiglitz is a University Professor at Columbia University. We draw heavily upon the World Development Report 2015. We are indebted to James Walsh for excellent research assistance and to Allison Demeritt, Paul DiMaggio, and Nan Zhou for fruitful discussions and advice. Financial support from INET and the Roosevelt Institute Project on Inequality, supported by the Ford Foundation, the Bernard and Irene Schwartz Foundation, and the John D. and Catherine T. MacArthur Foundation, is gratefully acknowledged.

  • ISSN: 01672681
  • CODEN: JEBOD
  • Source Type: Journal
  • Original language: English
  • DOI: 10.1016/j.jebo.2016.01.005
  • Document Type: Article
  • Publisher: Elsevier

  Hoff, K.; World Bank, United States;
© Copyright 2016 Elsevier B.V., All rights reserved.

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