Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/245440 
Year of Publication: 
2021
Series/Report no.: 
CESifo Working Paper No. 9259
Publisher: 
Center for Economic Studies and ifo Institute (CESifo), Munich
Abstract: 
A model that only focuses on economics relations, and in which efficiency and equity are defined in terms of resource allocation may miss an important part of the picture. We propose an integrated model that embeds economic activities in a larger game of social interactions, and define comprehensive notions of efficiency and equity. Social interactions provide additional sources of inefficiencies and inequalities, including through the mere lack of coordination between the regulation mechanisms of the economics sphere and the social sphere. Remedies may require more than market solutions and redistribution of resources. In particular, social norms are likely to play an important role.
Document Type: 
Working Paper
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