Human beings under some conditions tend to systematically overestimate their possibilities, under others to underestimate what is possible for them. This behaviour can be explained by differentiating between an ipsative possibility set (which includes what individuals consider relevant for themselves) and on objective one. These two possibility sets do not necessarily coincide. The difference may firstly be due to psychologicol processes as well as factors such as tradition and ideology. The difference may secondly be strategically designed by the individuals themselves (...) knowing that they otherwise reach less utility. The approach stresses that it is essential to determine the possibility sets within which individuals rationally decide between alternatives. (shrink)

Human beings under some conditions tend to systematically overestimate their possibilities, under others to underestimate what is possible for them. This behaviour can be explained by differentiating between an ipsative possibility set (which includes what individuals consider relevant for themselves) and on objective one. These two possibility sets do not necessarily coincide. The difference may firstly be due to psychologicol processes as well as factors such as tradition and ideology. The difference may secondly be strategically designed by the individuals themselves (...) knowing that they otherwise reach less utility. The approach stresses that it is essential to determine the possibility sets within which individuals rationally decide between alternatives. (shrink)

Since international trade leads to prosperity, most economics are in favor of globalization. This basic conviction is shared in this paper. Several standard arguments brought forward by critics of globalization - e.g. the claims that globalization increases poverty, destroys jobs, undermines the welfare state, enables international corporations to seize power and leads to environmental degradation and uniform culture - are shown to be invalid. Nevertheless, compared to orthodox economists, a more critical view of globalization is proposed in this paper, and (...) several shortcomings of globalization are discussed. These shortcomings are the unidirectional trade liberalization at the expense of developing countries, international organizations, like the IMF of World Bank, representing narrow economic interests and, above all, the lack of 'global governance'. Therefore, the implementation of functional overlapping competing jurisdiction is put forward. It is argued that the alternative proposition of a world government is dangerous, and global solidarity ineffective. (shrink)

First, the approaches of 'Diskursethik' (Discourse ethics) and of Modern Political Economy are described. While the latter investigates political decision processes, the former is concerned with the discourse process which takes place before a decision is made. This is shown by using referenda as an example. The discourse which takes place before referenda obviously does not conform to the ideal conditions defined in Diskursethik, but discourse and decisions in the context of referenda come nearer to the intentions of Diskursethik and (...) Political Economy than other decision procedures which are used in representative democracies. (shrink)

Democracies find it difficult, and sometimes impossible to get through projects desired by a large share of the population because these are strongly opposed by local residents (NIMBY: Not In My BackYard). As a solution for these conflicts, economists proposed offering (monetary) compensation to the citizens of the host community. Experiences with many different projects and countries reveal, however, that monetary payments are incapable of solving the NIMBY-problem. A monetary offer to accept an otherwise undesired project undermines civic virtue. This (...) crowding-out effect is empirically demonstrated using the search for a nuclear repository in Switzerland. A satisfactory strategy to overcome the NIMBY-problem takes into account the procedure, the time sequence, as well as the type of compensation offered. (shrink)

Strong forces lead to a withering of academia as it exists today. The major causal forces are the rankings mania, increased division of labor in research, intense publication pressure, academic fraud, dilution of the concept of ‘university’, and inadequate organizational forms for modern research. Academia, in a broader sense understood as ‘the locus of seeking truth and learning through methodological inquiry’, will subsist in different forms. The conclusion is therefore pessimistic with respect to the academic system as it presently exists (...) but not to scholarly endeavour as such. However, the transformation predicted is expected to be fundamental. (shrink)

Distortions in memory impose important bounds on rationality but have been largely disregarded in economics. While it is possible to learn, it is more difficult, and sometimes impossible, to unlearn. This retention effect lowers individual utility directly or via reduced productivity, and adds costs to principal-agent relationships. The engraving effect states that the more one tries to forget a piece of information the more vivid it stays in memory, leading to a paradoxical outcome. The effects are based on, and are (...) supported by, psychological experiments, and it is shown that they are relevant in many economic situations and beyond. (shrink)

Revolutionary developments in economics are rare. The conservative bias of the field and its enshrined knowledge make it difficult to introduce new ideas not in line with received theory. Happiness research, however, has the potential to change economics substantially in the future. Its findings, which are gradually being taken into account in standard economics, can be considered revolutionary in three respects: the measurement of experienced utility using psychologists' tools for measuring subjective well-being; new insights into how human beings value goods (...) and services and social conditions that include consideration of such non-material values as autonomy and social relations; and policy consequences of these new insights that suggest different ways for government to affect individual well-being. In Happiness, emphasizing empirical evidence rather than theoretical conjectures, Bruno Frey substantiates these three revolutionary claims for happiness research. After tracing the major developments of happiness research in economics and demonstrating that we have gained important new insights into how income, unemployment, inflation, and income demonstration affect well-being, Frey examines such wide-ranging topics as democracy and federalism, self-employment and volunteer work, marriage, terrorism, and watching television from the new perspective of happiness research. Turning to policy implications, Frey describes how government can provide the conditions for people to achieve well-being, arguing that a crucial role is played by adequate political institutions and decentralized decision making. Happiness demonstrates the achievements of the economic happiness revolution and points the way to future research.Bruno S. Frey is Professor of Economics at the University of Zurich, Visiting Professor at the Swiss Federal Institute of Technology, and Research Director of CREMA. He is co-editor of Economics and Psychology: A Promising New Cross-Disciplinary Field. (shrink)

Revolutionary developments in economics are rare. The conservative bias of the field and its enshrined knowledge make it difficult to introduce new ideas not in line with received theory. Happiness research, however, has the potential to change economics substantially in the future. Its findings, which are gradually being taken into account in standard economics, can be considered revolutionary in three respects: the measurement of experienced utility using psychologists' tools for measuring subjective well-being; new insights into how human beings value goods (...) and services and social conditions that include consideration of such non-material values as autonomy and social relations; and policy consequences of these new insights that suggest different ways for government to affect individual well-being. In Happiness, emphasizing empirical evidence rather than theoretical conjectures, Bruno Frey substantiates these three revolutionary claims for happiness research. After tracing the major developments of happiness research in economics and demonstrating that we have gained important new insights into how income, unemployment, inflation, and income demonstration affect well-being, Frey examines such wide-ranging topics as democracy and federalism, self-employment and volunteer work, marriage, terrorism, and watching television from the new perspective of happiness research. Turning to policy implications, Frey describes how government can provide the conditions for people to achieve well-being, arguing that a crucial role is played by adequate political institutions and decentralized decision making. Happiness demonstrates the achievements of the economic happiness revolution and points the way to future research.Bruno S. Frey is Professor of Economics at the University of Zurich, Visiting Professor at the Swiss Federal Institute of Technology, and Research Director of CREMA. He is co-editor of Economics and Psychology: A Promising New Cross-Disciplinary Field. (shrink)

This reply focusses on three aspects: advantages and disadvantages of our proposed ‘cooperative entry certificates’ for the countries of origin, for the migrants, and for the host countries. It analyzes in what respects our proposal can be improved based on the valuable points made by the commentators. In addition, the question of how to deal with winners and losers within the three groups is discussed.

Large-scale migration is one of the most topical issues of our time. There are two main problems. First, millions of persons will enter Europe in the short and middle run in spite of the firewalls we have built. When the income levels in the development countries raises, the migration pressure will even become stronger for a long time. Second, the present integration policy in most European countries is deficient. In contrast to common knowledge, strong social benefits for migrants, multicultural policies (...) and fast naturalization do not further integration. To address these two problems we propose a procedure that takes into account that most migrants react to incentives in a rational way. Migrants in our countries are joining a cooperative and take advantage of many collective goods and social institutions the citizen of the immigration countries have provided. Migrants therefore should pay an entry fee to join the cooperative. This proposal has positive consequences for both the countries of immigration and of origin, as well as for actual and would-be immigrants. It has many advantages compared to other schemes. (shrink)

Over the last decades, empirical research on subjective well-being in the social sciences has provided a major new stimulation of the discourse on individual happiness. Recently this research has also been linked to economics where reported subjective well-being is often taken as a proxy measure for individual welfare. In our review, we intend to provide an evaluation of where the economic research on happiness stands and of three directions it might develop. First, it offers new ways for testing the basic (...) assumptions of the economic approach and for going about a new understanding of utility. Second, it provides a new possibility for the complementary testing of theories across fields in economics. Third, we inquire how the insights gained from the study of individual happiness in economics affect public policy. (shrink)

This paper analyses whether the aggregation of individual happiness scores to a National Happiness Index can still be trusted once governments have proclaimed their main objective to be the pursuit—or even maximization—of this National Happiness Index. The answer to this investigation is clear-cut: as soon as the National Happiness Index has become a policy goal, it can no longer be trusted to reflect people’s true happiness. Rather, the Index will be systematically distorted due to the incentive for citizens to answer (...) strategically and the incentive for government to manipulate the Index in its favour. Such a distortion would arise even if the measurement of subjective well-being correctly reflected actual happiness before the intervention of government. Governments in a democracy should establish the conditions enabling individuals to become happy. The valuable and important results of happiness research should be introduced into the political process. Each person should be free to pursue happiness according to his or her preferences. This process is supported by obedience to the rule of law, human rights and free media, as well as by extended political participation rights, decentralized public decision-making, an open and effective education system fostering upward mobility and the possibility to find suitable employment. (shrink)

Cet article présente une analyse statistique de la position des économistes français et des spécialistes français des sciences de gestion parmi les chercheurs européens de haut rang. La preuve empirique révèle que la France ne développe pas fortement ses ressources humaines sur la scène internationale. La position de la France en Europe, repérée par les citations et les nominations par les pairs des chercheurs de haut rang et normalisée par la taille de la population, est seulement au neuvième rang en (...) ce qui concerne les sciences économiques et au huitième rang pour les sciences de gestion. Cela laisse penser que la politique scientifique a encore beaucoup à faire pour améliorer la situation.This note provides a statistical analysis of the position of French economists and French management scientists among the leading European scholars. The evidence shows that France does not strongly develop its human resources in the international setting. France’s position in Europe based on citations and peer nominations of the leading scholars normalized by the size of the population is only rank 9 with respect to economics, and rank 8 with respect to management science. This suggests that there is considerable scope for science policy to improve this situation. (shrink)

Economics and psychology are both sciences of human behaviour. This paper gives a survey of their interaction. First, the changing relationship between the two sciences is discussed: while economics was once imperialistic, it has become a science inspired by psychological insights. In order to illustrate this, recent developments and evidence for three major areas are presented: bounded rationality, non-selfish behaviour, and the economics of happiness.

The integration of economics and psychology has created a vibrant and fruitful emerging field of study. The essays in Economics and Psychology take a broad view of the interface between these two disciplines, going beyond the usual focus on "behavioral economics." As documented in this volume, the influence of psychology on economics has been responsible for a view of human behavior that calls into question the assumption of complete rationality, the acceptance of experiments as a valid method of economic research, (...) and the idea that utility or well-being can be measured.The contributors, all leading researchers in the field, offer state-of-the-art discussions of such topics as pro-social behavior and the role of conditional cooperation and trust, happiness research as an empirical tool, the potential of neuroeconomics as a way to deepen understanding of individual decision making, and procedural utility as a concept that captures the well-being people derive directly from the processes and conditions leading to outcomes. Taken together, the essays in Economics and Psychology offer an assessment of where this new interdisciplinary field stands and what directions are most promising for future research, providing a useful guide for economists, psychologists, and social scientists. (shrink)

States are ill equipped to meet the challenges of a globalized world. The concept of citizenship with its rights and obligations, including the allegiance owed, is too narrowly defined to exist only between individuals and a state. Today, people identify with, and pay allegiance to, many organizations beyond the state. This article suggests that citizenship could be extended further and be possible between individuals and quasi-governmental organizations, as well as non-governmental organizations, such as churches, clubs, interest groups, functional organizations and (...) profit firms. Due to the larger set of types of citizenship individuals could choose from, their preferences would be better fulfilled and, due to the competition for citizens induced among organizations, the efficiency of public activity would be raised. Key Words: citizenship • public goods • clubs • political competition • nations • globalization. (shrink)

Many academic economists take it as a matter of course that economics should become a natural science. Such a characterization misses an essential aspect of a social science, namely reactivity, i.e. human beings systematically respond to economic data, and in particular to interventions by economic policy, in a foreseeable way. To illustrate this finding, the paper uses examples from different fields: happiness policy, world heritage policy, and science policy. Reactivity requires a different policy approach from governments claiming to maximize social (...) welfare in the form of happiness. What is needed are basic constitutional provisions, or “rules of the game”, decided behind the veil of ignorance. Moral considerations must enter when the basic rules setting the way in which individuals interact are determined. Moral aspects are also indispensable as guidance to individuals when they take decisions within these rules. It is most unlikely that intelligent learning machines can fulfill this task in an acceptable manner. (shrink)

To combine some views of 'Diskursethik' and Constitutional Political Economy seems to be promising. In our comments on Frey's and Kirchgässner's attempt to join the forces of Discourse theory and Political Economy in defending the wider spread use of referenda we direct attention to three points. Firstly, the normative basis of both concepts is unsettled. Secondly, an economic approach contrary to the supposition of Frey and Kirchgässner provides substantial insights into the processes which precede collective decisions. Thirdly, the (...) 'veil of insignificance' in referenda will not necessarily increase altruism in voting behavior. (shrink)

To combine some views of 'Diskursethik' and Constitutional Political Economy seems to be promising. In our comments on Frey's and Kirchgässner's attempt to join the forces of Discourse theory and Political Economy in defending the wider spread use of referenda we direct attention to three points. Firstly, the normative basis of both concepts is unsettled. Secondly, an economic approach contrary to the supposition of Frey and Kirchgässner provides substantial insights into the processes which precede collective decisions. Thirdly, the (...) 'veil of insignificance' in referenda will not necessarily increase altruism in voting behavior. (shrink)

This volume contains thirteen new essays covering various issues in value theory. Eight of the essays were presented at a conference by the same name at Bowling Green State University, five others were commissioned. The essays vary in quality, and some of them cover themes developed in previously published work. But overall, each essay provides a carefully argued point of view on an important issue.

Over the last decades, empirical research on subjective well-being in the social sciences has provided a major new stimulation of the discourse on individual happiness. Recently this research has also been linked to economics where reported subjective well-being is often taken as a proxy measure for individual welfare. In our review, we intend to provide an evaluation of where the economic research on happiness stands and of three directions it might develop. First, it offers new ways for testing the basic (...) assumptions of the economic approach and for going about a new understanding of utility. Second, it provides a new possibility for the complementary testing of theories across fields in economics. Third, we inquire how the insights gained from the study of individual happiness in economics affect public policy. (shrink)

My contribution presents a possibility to unify Europe based on newly emerging political units focused on solving problems rather than on historically given nation states. These Endogenous Political Entities, as they shall be called, are better suited to reach the goals of European unification as they strengthen the fundamental European values of variety and freedom. I make three propositions: to base the unification of Europe on nation states is unfortunate as the latter are responsible for the political disaster of the (...) two World Wars; the unification must proceed in a problem-oriented manner. The constitution of Europe must allow and promote EPE to emerge specifically to deal with particular problems; the new political units can be introduced in marginal steps. Over time, a flexible and dynamic net of political entities will arise taking care of the large economic, social and cultural diversity in Europe. (shrink)

The allocation of any scarce health care resource, especially a lifesaving resource, can create profound ethical and legal challenges. Liver transplant allocation currently is based upon urgency, a sickest-first approach, and does not utilize capacity to benefit. While urgency can be described reasonably well with the MELD system, benefit encompasses multiple dimensions of patients’ well-being. Currently, the balance between both principles is ill-defined. This survey with 502 participants examines how urgency and benefit are weighted by different stakeholders. Liver transplant patients (...) favored the sickest-first allocation, although all other groups tended to favor benefit. Criteria of a successful transplantation were a minimum survival of at least 1 year and recovery of functional status to being ambulatory and capable of all self-care. An individual delisting decision was accepted when the 1-year survival probability would fall below 50%. Benefit was found to be a critical variable that may also trigger the willingness to donate organs. The strong interest of stakeholder for successful liver transplants is inadequately translated into current allocation rules. (shrink)

Background The allocation of any scarce health care resource, especially a lifesaving resource, can create profound ethical and legal challenges. Liver transplant allocation currently is based upon urgency, a sickest-first approach, and does not utilize capacity to benefit. While urgency can be described reasonably well with the MELD system, benefit encompasses multiple dimensions of patients’ well-being. Currently, the balance between both principles is ill-defined. Methods This survey with 502 participants examines how urgency and benefit are weighted by different stakeholders. Results (...) Liver transplant patients favored the sickest-first allocation, although all other groups tended to favor benefit. Criteria of a successful transplantation were a minimum survival of at least 1 year and recovery of functional status to being ambulatory and capable of all self-care. An individual delisting decision was accepted when the 1-year survival probability would fall below 50%. Benefit was found to be a critical variable that may also trigger the willingness to donate organs. Conclusions The strong interest of stakeholder for successful liver transplants is inadequately translated into current allocation rules. (shrink)

The question of how to become and remain an effective leader has been discussed for decades, and the answers that have been proposed have led to numerous theories and taxonomies of leadership behavior. By taking a critical approach to a contemporary integrative model of leadership behavior, this theoretical research proposes an alternative approach that can supplement both the integrative model and current leader–member exchange theory. Our approach is sensitive to both objective and subjective aspects of leadership behavior. We argue that (...) perceptions of leadership behavior are influenced by interpersonal relations and contextual variables in an organization. We further argue that multilevel aspects must be investigated to understand leadership behavior and that the perceptions thereof shape and are shaped by relations and contextual variables. A distinct methodological approach based on mixed methods is then proposed to better understand what influences perceptions of leadership behavior. The article discusses the conceptual, epistemological, and methodological consequences of studying leadership behavior and perceptions of such behavior. (shrink)

In lieu of an abstract, here is a brief excerpt of the content:Reviewed by:A Commonwealth of Hope: Augustine’s Political Thought by Michael LAMBMichael J. S. BrunoLAMB, Michael. A Commonwealth of Hope: Augustine’s Political Thought. Princeton, N.J.: Princeton University Press, 2022. xiii + 431 pp. Cloth, $39.95In his comprehensive study of Augustinian hope, Michael Lamb seeks to provide a corrective to the common characterization, especially promoted in the last century, of Augustine as politically and socially pessimistic. Lamb asserts that Augustine’s work (...) leads us, rather, to a “realistic hope,” as he argues for a more “hopeful, this-worldly” reading of the Doctor of Grace. After tracing the path of contemporary Augustinian interpretation, Lamb begins an interdisciplinary study of Augustine’s understanding of hope, which he argues allows us to understand how Augustine “advocated and modeled engagement in public life,” as “bishop, theologian, and citizen.”In part 1, “The Virtue of Hope,” Lamb systematically discusses Augustine’s understanding of virtue, and the relationship within his theology of the theological virtues. In chapter 1, Lamb utilizes the Enchiridion to explore Augustine’s understanding of the objects and grounds of hope, as “the orientation of will” toward objects that “engage our desire and spark an affective movement for union with what we love.” In chapter 2, Lamb explores hope’s integral connection to love and integrally captures key concepts in Augustine’s thought, particularly the consequences of the Fall in human pride, the presence of the libido dominandi, and the often-discussed debate of uti-frui, noting that Augustine is fundamentally concerned with love being rightly ordered. In chapter 3, he responds to the criticism of Augustine’s hope as “otherworldly,” explaining how Augustine does not dismiss temporal goods but, rather, “chastens disordered desires for them.” Lamb also makes clear that Augustine “challenges the either/or dualism” that locates [End Page 154] eternal goods in a purely transcendent realm. In chapter 4, Lamb analyzes the grounds of faith and its objects, outlining Augustine’s treatment of faith’s relation to both authority and neighbor, who for Augustine must be included as an object of faith. In chapter 5, relying on Augustine’s Confessions, Lamb underscores the condemnation of Pelagianism while demonstrating that similar to love, we might hope in neighbors as “a way to hope in the invisible God.” He also examines the epistemological challenges presented by the vices of presumption and despair, noting how for Augustine “a deficient or disordered faith leads to disordered hope.”Part 2 of Lamb’s work turns to Augustine’s rhetoric and how Augustine’s pedagogical concerns undergird both his sermons and other works, especially the often-cited City of God. In chapter 6, Lamb notes the need within political interpretations of Augustine for a greater grasp of “his rhetorical and pedagogical purposes,” especially his moral teaching offered to a wide and diverse audience both in his preaching and letters. In chapter 7, Lamb turns to City of God, noting its aim as both instruction and encouragement, and confronts the limits of the binary view of optimism and pessimism as “anachronistic and conceptually confining.” Lamb, on the contrary, posits a “more capacious triad of presumption, hope, and despair” as capturing the true “posture” of Augustine’s City of God, especially book 22.In part 3, Lamb focuses on the place of political goods as objects of hope within Augustine’s thought. Chapter 8 focuses on the political implications of Augustine’s eschatology and ecclesiology and, through engagement with numerous interpreters, examines Augustine’s saeculum as “a passing age in which members of both cities—earthly and heavenly—share proximate goods and build a common life together.” In chapter 9, Augustine’s epistolary is examined in order to demonstrate that, while “fulfilling his duties and embodying active citizenship, [Augustine] did not make an idol of politics or see it as the ultimate source of salvation.” In chapter 10, Lamb proposes an alternative account to the “antipolitical, otherworldly exclusivist” Augustine, namely, an Augustine who both is slow to judge the virtue and vice of others and acknowledges “some form of genuine, if incomplete, virtue in those without faith.” In this chapter, Lamb’s nuances of Augustine’s understanding of “true virtue” are well grounded... (shrink)

According to Aristotle, the three main varieties of soul – nutritive, perceptual, and rational – are hierarchically ordered. I develop and defend an interpretation of the soul’s unity that centers on Aristotle’s attempt to explain this hierarchy’s organizing cause. Aristotle draws an analogy between this series of souls and the series of figures. I first elucidate the fundamental feature both series share: each series’ prior members are present in capacity in its posterior members. I do so by examining several other (...) cases – mathematical, biological, and physical – where Aristotle appeals to presence in capacity. I then argue that an organism’s living body is continuous by nature. That is, an organism’s soul is the principle, cause, and end of a single, articulate activity of living and each of an organism’s vital bodily movements are aspects or partial manifestations of this unitary, natural activity. This account of natural continuity is, I contend, the key to understanding what it is for one soul to be present in capacity in another. And this account of presence in capacity is, I contend, the key to understanding what it is for a soul that comprises parts to be a unity. (shrink)