Laws and Authority
Publication Year
2017
Type
Journal Article
Abstract
A law prohibiting a particular behavior does not directly change the payoff to an individual should he engage in the prohibited behavior. Rather, any change in the individual's payoff, should he engage in the prohibited behavior, is a consequence of changes in other peoples' behavior. If laws do not directly change payoffs, they are "cheap talk," and can only affect behavior because people have coordinated beliefs about the effects of the law. Beginning from this point of view, we provide definitions of authority in a variety of problems, and investigate how and when individuals can have, gain, and lose authority.
Keywords
Journal
Research in Economics
Volume
71
Issue
1
Pages
- 42
Date Published
March 2017
ISBN
1090-9443, 1090-9443