Working Paper Series
Social Norms and Economic Incentives in the Welfare State
(), Sten Nyberg and Jörgen W. Weibull
Abstract: This paper analyzes the interplay between social norms and
economic incentives in the context of work decisions in the modern welfare
state. We assume that to live off one's own work is a social norm, and that
the larger the population fraction adhering to this norm, the more
intensely it is felt by the individual. Individuals face two choices, one
economic, whether to work or live off public transfers, and one political,
how large the transfer should be. The model highlights certain factors
determining the size of the welfare state.
Keywords: Welfare Economics; Decision Making; Incentives; (follow links to similar papers)
JEL-Codes: D60; D81; O31; (follow links to similar papers)
27 pages, May 1997
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