 Moral marketsPaul J. Zak Journal of Economic Behavior & Organization, 2011, vol. 77, issue 2, 212-233 Abstract: Is market exchange solely dependent on selfishness or does other-regarding behavior play any substantial role? This article reviews the philosophical, psychological and neurological basis for moral values, showing that they are consistent and measurable. I demonstrate that values play a role in social interactions, including market exchange. Indeed, market exchange in moderately regulated economies is predicated on the notion that most people, most of the time, behave morally - albeit in the shadow of enforcement. This idea is of ancient origin, but is most clearly articulated in Adam Smith's Theory of Moral Sentiments. The moral nature of social decisions is used to identify modifications of the standard expected utility model, and implications for a value-based approach to human decisions are elucidated for law, regulation, business organization, economic growth, and happiness. The conditions that lead to moral market failures like the Enron debacle are also described. Not only do morals underpin markets, but intriguing new evidence suggests that markets may strengthen moral values. Keywords: Values; Adam; Smith; Markets; Neuroeconomics; Regulation; Happiness (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:jeborg:v:77:y:2011:i:2:p:212-233 Access Statistics for this article Journal of Economic Behavior & Organization is currently edited by Houser, D. and Puzzello, D. More articles in Journal of Economic Behavior & Organization from Elsevier |
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