Image versus Information: Changing Societal Norms and Optimal Privacy

S. Nageeb Ali and Roland Benabou

American Economic Journal: Microeconomics, 2020, vol. 12, issue 3, 116-64

Abstract: We analyze the costs and benefits of using social image to foster desirable behaviors. Each agent acts based on his intrinsic motivation, private assessment of the public good, and reputational concern for appearing prosocial. A Principal sets the general degree of privacy, observes the social outcome, and implements a policy: investment, subsidy, law, etc. Individual visibility reduces free riding but makes aggregate behavior ("descriptive norm") less informative about societal preferences ("prescriptive norm"). We derive the level of privacy (and material incentives) that optimally trades off social enforcement and learning, and we characterize its variations with the economy's stochastic and informational structure.

JEL-codes: D82 D83 D91 Z13 (search for similar items in EconPapers)
Date: 2020
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Citations: View citations in EconPapers (20)

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Related works:
Working Paper: Image Versus Information: Changing Societal Norms and Optimal Privacy (2016)
Working Paper: Image versus Information: Changing Societal Norms and Optimal Privacy (2016)
Working Paper: Image Versus Information: Changing Societal Norms and Optimal Privacy (2016)
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DOI: 10.1257/mic.20180052

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