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Behavioral Public Economics shows how standard public economics can be improved using insights from behavioral economics. Public economics typically lists four market failures that may justify government intervention in markets-imperfect competition (or natural monopoly), externalities, public goods, and asymmetric information. Under the rational choice paradigm ('agents choose what is best for them'), public economics has examined the welfare effects of policy. Recent research in behavioral economics highlights a fifth market failure-individuals may make mistakes in pursuing their own well-being. This book calls for a rethinking of assumptions of individual behavior and provides a good foundation for public economic theory.
Key features:
Introduces behavioral perspectives into public economics.
Explains why economic incentives often undermine social preferences.
Reveals that social incentives matter for public policy.
This book will be an invaluable resource for researchers and postgraduate students in public economics, behavioral economics, and public policy.
List of contents
1. Introduction: Why ‘Behavioral’ Public Economics 2. Preferences, Utility, and Welfare 3. Economic Incentives in Public Economics 4. Behavioral Economics and Public Policy 5. Social Preferences and Moral Economy 6. Social Incentives and Interaction 7. Governing the Commons with Social Incentives. Bibliography
About the author
Shinji Teraji is Professor of Economics at Yamaguchi University, Japan. His research is mainly concerned with behavioral economics, institutional economics, and economic methodology.
Summary
Behavioral Public Economics shows how standard public economics can be improved using insights from behavioral economics. This book calls for a rethinking of assumptions of individual behavior and provides a good foundation for public economic theory.
