Behavioral Public Finance

ISBN-10: 1610443853
ISBN-13: 9781610443852
Category: Business & Economics
Pages: 416
Language: English
Published: 2006-01-23
Publisher: Russell Sage Foundation
Authors: Joel Slemrod, Edward J. McCaffery

Description

Behavioral economics questions the basic underpinnings of economic theory, showing that people often do not act consistently in their own self-interest when making economic decisions. While these findings have important theoretical implications, they also provide a new lens for examining public policies, such as taxation, public spending, and the provision of adequate pensions. How can people be encouraged to save adequately for retirement when evidence shows that they tend to spend their money as soon as they can? Would closer monitoring of income tax returns lead to more honest taxpayers or a more distrustful, uncooperative citizenry? Behavioral Public Finance, edited by Edward McCaffery and Joel Slemrod, applies the principles of behavioral economics to government's role in constructing economic and social policies of these kinds and suggests that programs crafted with rational participants in mind may require redesign. Behavioral Public Finance looks at several facets of economic life and asks how behavioral research can increase public welfare. Deborah A. Small, George Loewenstein, and Jeff Strnad note that public support for a tax often depends not only on who bears its burdens, but also on how the tax is framed. For example, people tend to prefer corporate taxes over sales taxes, even though the cost of both is eventually extracted from the consumer. James J. Choi, David Laibson, Brigitte C. Madrian, and Andrew Metrick assess the impact of several different features of 401(k) plans on employee savings behavior. They find that when employees are automatically enrolled in a retirement savings plan, they overwhelmingly accept the status quo and continue participating, while employees without automatic enrollment typically take over a year to join the saving plan. Behavioral Public Finance also looks at taxpayer compliance. While the classic economic model suggests that the low rate of IRS audits means far fewer people should voluntarily pay their taxes than actually do, John Cullis, Philip Jones, and Alan Lewis present new research showing that many people do not underreport their incomes even when the probability of getting caught is a mere one percent. Human beings are not always rational, utility-maximizing economic agents. Behavioral economics has shown how human behavior departs from the assumptions made by generations of economists. Now, Behavioral Public Finance brings the insights of behavioral economics to analysis of policies that affect us all.

Get the book

Similar books

Policy and Choice: Public Finance through the Lens of Behavioral Economics
By William J. Congdon, Jeffrey R. Kling, Sendhil Mullainathan
60–68; Eric C. Schneider and Arnold M. Epstein, “Use of Public Performance Reports,” JAMA, vol. 279, no. 20 (May 27, 1998), pp. 1638–42. e. Haiden A. Huskamp and others, “The Impact of a Three-Tier Formulary on Demand Response for ...
Behavioural Public Finance: Individuals, Society, and the State
By M. Mustafa Erdoğdu, Larissa Batrancea, Savaş Çevik
This book tackles political, social, and behavioural aspects of public finance and fiscal exchange.
Behavioral Public Economics: Social Incentives and Social Preferences
By Shinji Teraji
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.
Handbook of Behavioral Economics - Foundations and Applications 1

Experimental methods and valuation. In: Handbook of Environmental Economics, vol. 2. Elsevier, pp. 969–1027. ... In: Keren, Gideon, Wu, George (Eds.), Wiley–Blackwell Handbook of Judgment and Decision Making. Wiley– Blackwell Publishing ...
Public Finance with Behavioural Agents
By Raphaël Lardeux
Recent developments in behavioural economics have deeply influenced the way governments design public policies.
Public Finance: A Normative Theory
By Richard W. Tresch
The revisions only improve the text, including a new chapter on taxation under asymmetric information. Any student or professor with an interest in the normative side of public economics will want to own this book.
Behavioural Economics and Finance
By Michelle Baddeley
This new edition of Behavioural Economics and Finance is a thorough extension of the first edition, including updates to the key chapters on prospect theory; heuristics and bias; time and planning; sociality and identity; bad habits; ...
Behavioral Finance: Understanding the Social, Cognitive, and Economic Debates
By Edwin Burton, Sunit Shah
That is why Edwin Burton has written Behavioral Finance: Understanding the Social, Cognitive, and Economic Debates. Engaging and informative, this timely guide contains valuable insights into various issues surrounding behavioral finance.
Public Finance: A Normative Theory
By Richard W. Tresch
Public Finance remains the premier textbook on the normative theory of government policy, with the third edition propelling into the twenty-first century its examination of what government ought to be doing instead of what it is doing.
Behavioral Economics and Public Health
By Ichirō Kawachi, Christina A. Roberto
With contributions from an international team of scholars from psychology, economics, marketing, public health, and medicine, this book is a trailblazing new approach to the most difficult and important problems of our time.