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Incentives - Motivation and the Economics of Information
Publisher: Cambridge University Press

Here is some background information to help you out. Looking around, I found a recent review paper by Bowles and Polania-Reyes that examined how explicit economic incentives change motivation. They lead us on a journey to discover the economics underlying human motivation and how to structure the incentives that can get people to move mountains. Economic Lesson(s): Prices transmit information about relative scarcity. Strict compliance does not increase access to economic information. The administration's choice of policy will reveal the true motivation behind a gas tax: If the motivation is to create incentives for better fuel efficiency and reduced externalities, then we will see an increase in the per gallon gas tax. I did not suggest all sectors ought to receive special benefits or incentives after demonstrating their economic impact. Producers respond to prices and incentives. The most significant assumption in ideal theory is strict compliance in that persons are assumed to comply with the dictates of just institutions in virtue of having a normally effective sense of justice, that is, they are motivated to be just . Possible ways to enhance environmental sustainability involve encouraging people to change their life-style towards more eco-conscious behaviour using information campaigns and price-based instruments. This includes bank managers' incentives to boost short-term profits and create banks that are “too big to fail”, regulators' incentives to forebear and withhold information from other regulators in stressful times, credit rating agencies' incentives to keep issuing high ratings for Despite the broad agreement among economists, the focus of financial sector regulation and supervision has often been on other things, leaving incentives to be addressed indirectly at best. The concept behind Recyclebank is simple: because economic incentives motivate recycling more effectively than green principles, reward people for recycling and watch the rates soar. The Recyclebank system is quick and painless: each We would also like to continue to add information about what people can do for the environment in their local communities, so we're working on a “green search” function on the homepage. (1) POD is unworkable at the level of ideal theory because, even under idealized conditions, it generates bad incentives and faces severe information problems.