ECO331H1 Chapter Notes - Chapter Week 11: Marginal Utility, Behavioral Economics, Polo Shirt
Document Summary
Week 11: identity and the economics of organizations, Standard economic model: individual"s preferences are fixed, utility depends on pecuniary variables. At west point: alter identity to change cadet preferences so cadets think of self above all else as officers in us army. Employees have identities that lead them to behave in line with goals of organization. Willing to put in high effort without wage variation. Can only be based on observable variables which may be imperfect indicators of effort. Utility depends on tastes and norms (how people think they and others should behave) How people feel about self, how feelings depend on actions. Identity describes gains and losses in utility from behavior that conforms or departs from the norms for particular social categories in particular situations. Utility is situation dependent based on norms that are taught. Identity suggests natural way in which behavior can vary within population. Identity consists of commonly understood classifications and are possible to observe.
