Self-Interest, Incentives and the Decision-Making

Steinbacher, Matjaz (2009): Self-Interest, Incentives and the Decision-Making.

Abstract

Paper analyzes the impact of incentives and disincentives on the decision-making of individuals. Their role in the decision-making processes is huge, as they affect the cost-benefit analysis of investment projects of scarce resources. They both are subject of huge negative effects. A hidden trap of providing incentives is represented by costs any such activity involves, with coercive subsidies having socialized costs for the benefits of individuals. This makes them very dangerous and controversial.

• Item Type: MPRA Paper
• Language: English
• Keywords: Evolutionary games, incentives and disincentives, investment decisions, Roy model
• Subjects: D - Microeconomics > D6 - Welfare Economics > D61 - Allocative Efficiency ; Cost-Benefit Analysis; Z - Other Special Topics > Z1 - Cultural Economics ; Economic Sociology ; Economic Anthropology > Z13 - Economic Sociology ; Economic Anthropology ; Social and Economic Stratification; M - Business Administration and Business Economics ; Marketing ; Accounting ; Personnel Economics > M5 - Personnel Economics > M52 - Compensation and Compensation Methods and Their Effects; C - Mathematical and Quantitative Methods > C7 - Game Theory and Bargaining Theory > C73 - Stochastic and Dynamic Games ; Evolutionary Games ; Repeated Games

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