On the importance of social norms and the unintended consequences of trying to economize them

An interesting entry in the "Bookmark" channel (they write about all sorts of different things from the field of social sciences) about the importance of social norms and the unintended consequences of trying to economize them. One of the most notorious bad examples of solving the problem of social relations by economic means is an experiment in kindergartens conducted in Israel in 1998.

Usually parents rush to pick up their children from kindergarten after work. But sometimes, for various reasons, parents are late, because of which the teachers are delayed for extra time. What would you do in the place of kindergarten leaders to minimize lateness?

Economists have conducted such an experiment (Uri Gneezy and Aldo Rustichini. 2000. A Fine Is a Price. The Journal of Legal Studies 29 (January): pp. 1–17.). They introduced fines in some kindergartens, while others left everything as it is (control group). The "price of being late" went from zero to ten Israeli shekels (about $3 at the time). Surprisingly, after the introduction of the fine, the frequency of lateness doubled (see figure).

Why were the consequences the way they were? One possible explanation is that before the fine was introduced, most parents showed up on time because they thought it was the right thing to do. In other words, they arrived on time due to a moral obligation not to inconvenience the kindergarten staff. However, imposing a fine signaled to parents: no moral obligations, only shopping, and the client is always right if he pays. Lateness became possible to buy, like vegetables or ice cream in the store.

The introduction of the cost of being late changed the scope of choice. If earlier parents primarily thought about moral aspects, now about convenience. After the end of the experiment, the number of lateness in kindergartens, where such prices were previously introduced, remained at the same high level. In general, minced meat cannot be turned back so quickly.

Of course, here you can object, they say, but what is it? Well, now latecomers pay for being late, that is, they compensate for the negative effects of their behavior on those who suffer from it. In fact, two things are important to us:

• 1) economic decisions may not lead to the desired result at all;
• 2) Putting everything back together can be difficult.

In this regard, it is interesting to think about corruption. If in a certain system any issue is resolved for money, we get only a deepening of corruption ties. Moreover, the corruption canopy itself will only expand. In short, in addition to economic incentives, the cultural norms and moral imperatives adopted in public service systems are important. In general, the market is, of course, good, but far from everything can (and should) be economized and viewed through the prism of purely economic incentives (for example, I hate talking about the marriage market). Humans are more complex beings. And the economic motive is not the only one. To think differently is to support the very economic imperialism that economic science has long abandoned, but which for some reason has deeply ingrained itself in the minds of some politicians and projectors.

Grigory Bazhenov 2022-11-22