Roland Bénabou

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Incentives and Prosocial Behavior We develop a theory of prosocial behavior that combines heterogeneity in individual altruism and greed with concerns for social reputation or self-respect. Rewards or punishments (whether material or image-related) create doubt about the true motive for which good deeds are performed and this “overjustification effect” can(More)
Even relatively poor people oppose high rates of redistribution because of the anticipation that they, or their children, may make it up the income ladder. This “prospect of upward mobility” (POUM) hypothesis is often advanced as one of the factors limiting the extent of redistribution in democracies. But is it compatible with all voters holding rational(More)
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This paper proposes that idiosyncratic firm-level shocks can explain an important part of aggregate movements and provide a microfoundation for aggregate shocks. Existing research has focused on using aggregate shocks to explain business cycles, arguing that individual firm shocks average out in the aggregate. I show that this argument breaks down if the(More)
Access to private information is shown to generate both the incentives and the ability to manipulate asset markets through strategically distorted announcements. The fact that privileged information is noisy interferes with the public's attempts to learn whether such announcements are honest; it allows opportunistic individuals to manipulate prices(More)
This paper describes the correlations between inequality and the growth rates in crosscountry data. Using non-parametric methods, we show that the growth rate is an inverted U-shaped function of net changes in inequality: Changes in inequality (in any direction) are associated with reduced growth in the next period. The estimated relationship is robust to(More)