Human beings routinely help strangers at costs to themselves. Sometimes the help offered is generous - offering more than the other expects. The proximate mechanisms supporting generosity are not well-understood, but several lines of research suggest a role for empathy. In this study,...

Economic reform in China has created a small but fast-growing private sector that has spurred rapid productivity growth. Growth of the private sector is predicated upon continued labor movements away from state-run industries and into private firms. This paper presents a theory of labor market...

Institutions can affect individual behavior both via their efficiency impact and via their risk reducing mechanisms. However there has been little study of the relative importance of these two channels in how individuals choose between simultaneously extant institutions. This paper presents a...

The traditional view in economics is that individuals respond to incentives, but absent strong incentives to the contrary selfishness prevails. Moreover, this "greed is good" approach is deemed "rational" behavior. Nevertheless, in daily interactions and in numerous laboratory studies, a high...

Trust pervades human societies. Trust is indispensable in friendship, love, families and organizations, and plays a key role in economic exchange and politics. In the absence of trust among trading partners, market transactions break down. In the absence of trust in a country's institutions and...

Recent findings in the biomedical literature have shown that roughly three-quarters of one's cognitive abilities are an endowment from one's parents. This paper develops an open economy theory of endogenous growth in which agents make fertility and migration choices which affect the rate of...

This paper introduces an emerging transdisciplinary field known as neuroeconomics. Neuroeconomics uses neuroscientific measurement techniques to investigate how decisions are made. First, I present a basic overview of neuroanatomy and explain how brain activity is measured. Then I survey...

We analyze the dynamics of a simple growth model in which production occurs with a delay while new capital is installed (time-to-build). The time-to-build technology is shown to yield a system of functional (delay) differential equations with a unique steady state. We demonstrate that the steady...

The purpose of this paper is to catalog some of the important findings from the fields of psychology and neurology, and to show potential implications for economics, with particular emphasis on financial markets. The blending of these fields is developing a new sub-field of neuroeconomics known...

Like nature itself, modern economic life is driven by relentless competition and unbridled selfishness. Or is it? Drawing on converging evidence from neuroscience, social science, biology, law, and philosophy, Moral Markets makes the case that modern market exchange works only because most...