Working Paper: NBER ID: w29942
Authors: Augustin Landier; David Thesmar
Abstract: This paper investigates the drivers of support for market mechanisms (competition and optimizing behavior by agents). We elicit such attitudes using concrete and simplified situations where respondents face a tradeoff between an economically efficient situation and a pro-social objective. We find that support for deviation from efficient solutions achieved through market mechanism is strongly correlated with moral values as defined by Haidt (2013): care, fairness, loyalty and authority. While the traditional left-right divide spans some of this variation, an even bigger role is played by what we label “individualism”, the average support for all 4 values, a moral stance orthogonal to the left-right divide. We ground this measure of individualism in the sociology of Emile Durkheim.
Keywords: individualism; market mechanisms; moral values; Durkheim; support for competition
JEL Codes: A11; A13
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Individualism (P14) | Support for market mechanisms (D47) |
| Individualism (P14) | Support for policies that deviate from market efficiency (G18) |
| Individualism (P14) | Preferences favoring market solutions (D47) |
| Individualism (P14) | Aversion to market distortions (D41) |