The Relevance of Social Norms for Economic Efficiency: Theory and its Empirical Test

Anil Alpman ()

Documents de travail du Centre d'Economie de la Sorbonne from Université Panthéon-Sorbonne (Paris 1), Centre d'Economie de la Sorbonne

Abstract: This paper proposes a new theory of social norms that explores the relation between individuals' income, time allocation decisions, and consumption choices on the one hand, and the determinants of individuals' decision to conform or not to social norms on the other. It is shown that rational consumers may obey inefficient social norms, which in turn would slow economic development. An empirical test of the model is performed for different categories of countries using the World Values Survey, a voluminous cross-country micro dataset. The results yield the gain and the cost of disobeying inefficient social norms, the latter of which can be used as an indicator of social pressure regarding conformity

Keywords: Social norms; social interactions; consumer behavior; household production; economic development; social pressure indicator (search for similar items in EconPapers)
JEL-codes: D11 D12 O43 Z13 (search for similar items in EconPapers)
Pages: 28 pages
Date: 2013-04, Revised 2013-08
New Economics Papers: this item is included in nep-evo and nep-soc
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Persistent link: https://EconPapers.repec.org/RePEc:mse:cesdoc:13038r

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