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American Economic Review: Vol. 100 No. 4 (September 2010)


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Morally Motivated Self-Regulation

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Baron, David P. 2010. "Morally Motivated Self-Regulation." American Economic Review, 100(4): 1299-1329.

DOI: 10.1257/aer.100.4.1299


Self-regulation is the private provision of public goods and private redistribution. This paper examines the scope of self-regulation motivated by altruistic moral preferences that are reciprocal and stronger the closer are citizens in a socioeconomic distance. The focus is on the role of organizations in increasing self-regulation by mitigating free-rider problems. Social label and certification organizations can expand the scope of self-regulation but not beyond that with unconditional altruism. Enforcement organizations expand the scope of self-regulation farther, and for-profit enforcement is more aggressive than nonprofit enforcement. Enforcement through social pressure imposed by NGOs also expands the scope of self-regulation. (JEL D64, H41, L51)

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Baron, David P. (Stanford U and Northwestern U)

JEL Classifications

D64: Altruism
H41: Public Goods
L51: Economics of Regulation

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