Working Paper

Accounting for Context: Separating Monetary and Social Incentives

Kiel Working Papers, 1971

This paper proposes a simple framework to model social preferences in a game theoretic framework which explicitly separates economic incentives from social (context) effects. It is argued that such a perspective makes it easier to analyse contextual effects. Moreover, the framework is used to exemplify both theoretically and empirically how contextual variables such as social norms can worsen a social dilemma or possibly make it disappear. The empirical results of a randomised controlled classroom experiment show that women are more responsive to such contextual effects and that social agreements can also worsen economic inefficiencies.


Andreas Bergh
Prof. Dr. Philipp C. Wichardt - Institut für Weltwirtschaft (IfW) / Kiel Institute for the World Economy
Philipp Wichardt


Publication Date
JEL Classification
D3, D63, Z10