Skip to main content
SpringerLink
Log in

Morality and Rationality in Environmental Policy

  • Published:
Journal of Consumer Policy Aims and scope Submit manuscript

Abstract

The "Moralist" camp takes environmental morale to be essential in order to save nature. The "Rationalist" camp, mainly represented by economists, takes market-based instruments solely relying on extrinsic motivation to be both necessary and sufficient for a successful environmental policy. Recently, the moralists have learned to appreciate economists' incentive instruments, and rationalists have learned that environmental morale is required to find political support for the introduction of their preferred instruments.

Intrinsic motivation in the form of environmental morale is moreover closely connected to the extrinsic motivation via crowding effects. Economic incentives – in particular tradeable emission rights and emission taxes – tend to undermine environmental morale while policy instruments tend to raise it.

An environmental policy based on complementarity is able to exploit the advantages, and to weaken the disadvantages, of the policies proposed by the two camps. Market-based instruments should be accompanied by policies informing and inviting the consumers to engage. In addition, possibilities to participate in the decision-making about environmental policy should be offered (preferably via direct democracy), and the policy should be decided and undertaken at the lowest possible level, normally the local community level.

This is a preview of subscription content, log in via an institution to check access.

Access this article

Log in via an institution

Price excludes VAT (USA)
Tax calculation will be finalised during checkout.

Instant access to the full article PDF.

Institutional subscriptions

Similar content being viewed by others

REFERENCES

  • Akerlof, G. A. (1989). The economics of illusion. Economics and Politics, 1, 1-15.

    Google Scholar 

  • Alchian, A. A., & Demsetz, H. (1972). Production, information costs and economic organization. American Economic Review, 62, 777-795.

    Google Scholar 

  • Barkema, H. G. (1995). Do job executives work harder when they are monitored? Kyklos, 48, 19-42.

    Google Scholar 

  • Baumol, W. J., & Oates, W. E. (1979). Economics, environmental policy, and the quality of life. Englewood Cliffs, NJ: Prentice-Hall.

    Google Scholar 

  • Becker, G. S. (1976). The economic approach to human behavior. Chicago: Chicago University Press.

    Google Scholar 

  • Blinder, A. S. (1987). Hard heads, soft hearts. Reading, MA: Addison-Wesley.

    Google Scholar 

  • Bohnet, I., & Frey, B. S. (1999). The sound of silence in prisoner's dilemma and dictator games. Journal of Economic Behavior and Organization, 38, 43-57.

    Google Scholar 

  • Buchanan, J. M., & Tullock, G. (1975). Pollutors' profits and political response: Direct controls versus taxes. American Economic Review, 65, 139-147.

    Google Scholar 

  • Budge, I. (1996). The new challenge of direct democracy. Cambridge: Polity Press.

    Google Scholar 

  • Butler, D., & Ranney, A. (Eds.) (1994). Referendums around the world. The growing use of direct democracy. Washington, DC: AEI Press.

    Google Scholar 

  • Cameron, J., & Pierce, W. D. (1994). Reinforcement, reward, and intrinsic motivation: A meta-analysis. Review of Educational Research, 64, 363-423.

    Google Scholar 

  • Cooter, R. D. (1984). Prices and sanctions. Columbia Law Review, 84, 1523-1560.

    Google Scholar 

  • Cooter, R. D. (1994). Laws and prices: How economics contributed to law by misunderstanding morality. Berkeley, CA: University of California at Berkeley. Working Paper No. 94-2, Program in Law and Economics.

    Google Scholar 

  • Cronin, T. E. (1989). Direct democracy. The politics of initiative, referendum and recall. Cambridge, MA: Harvard University Press.

    Google Scholar 

  • Cropper, M. L., & Oates, W. E. (1992). Environmental economics: A survey. Journal of Economic Literature, 30, 675-740.

    Google Scholar 

  • Dawes, R. M., McTavish, J., & Shaklee, H. (1977). Behavior, communication, and assumptions about other people's behavior in a commons dilemma situation. Journal of Personality and Social Psychology, 35, 1-11.

    Google Scholar 

  • Dawes, R. M. (1988). Rational choice in an uncertain world. San Diego, CA: Harcourt, Brace, Jovanovich.

    Google Scholar 

  • Dawes, R. M., van de Kragt, A. J. C., & Orbell, J. M. (1988). Not me or thee but We: The importance of group identity in eliciting cooperation in dilemma situations — Experimental manipulations. Acta Psychologica, 68, 83-97.

    Google Scholar 

  • Deci, E. L. (1971). Effects of externally mediated rewards on intrinsic motivation. Journal of Personality and Social Psychology, 18, 105-115.

    Google Scholar 

  • Deci, E. L., & Ryan, R. M. (1985). Intrinsic motivation and self-determination in human behavior. New York: Plenum Press.

    Google Scholar 

  • Deci, E. L., Koestner, R., & Ryan, R. M. (forthcoming). Extrinsic rewards and intrinsic motivation: A clear and consistent picture after all. Psychological Bulletin.

  • De Young, R. (1985–1986). Encouraging environmentally appropriate behavior: The role of intrinsic motivation. Journal of Environmental Systems, 15, 281-292.

    Google Scholar 

  • Diekmann, A. (1995). Umweltbewusstsein oder Anreizstrukturen? Empirische Befunde zum Energiesparen, der Verkehrsmittelwahl und zum Konsumverhalten. In: A. Diekmann & A. Franzen (Eds.), Kooperatives Umwelthandeln. Modelle, Erfahrungen, Massnahmen, pp. 39-68. Chur: Rüegger.

    Google Scholar 

  • Diekmann, A., & Preisendörfer, P. (1993). Persönliches Umweltverhalten. Diskrepanzen zwischen Anspruch und Wirklichkeit. Kölner Zeitschrift für Soziologie und Sozialpsychologie, 44, 226-251.

    Google Scholar 

  • Diekmann, A., & Preisendörfer, P. (1998). Umweltbewusstsein und Umweltverhalten in Low-und High-Cost-Situationen. Eine empirische Untersuchung der Low-Cost-Hypothese. Bern: University of Bern, Institute of Sociology. Mimeo.

  • Eisenberger, R., & Cameron, J. (1996). Detrimental effects of reward. Reality or myth? American Psychologist, 51, 1153-1166.

    Google Scholar 

  • Fama, E. F., & Jensen, M. C. (1983). Separation of ownership and control. Journal of Law and Economics, 26, 301-351.

    Google Scholar 

  • Faulhaber, G. R., & Baumol, W. J. (1988). Economists as innovators. Journal of Economic Literature, 26, 577-600.

    Google Scholar 

  • Frey, B. S. (1997a). Not just for the money. An economic theory of personal motivation. Cheltenham, UK: Edward Elgar.

    Google Scholar 

  • Frey, B. S. (1997b). A constitution for knaves crowds out civic virtues. Economic Journal, 107, 1043-1053.

    Google Scholar 

  • Frey, B. S. (1999). Economics as a science of human behaviour. Boston: Kluwer.

    Google Scholar 

  • Frey, B. S., & Bohnet, I. (1995). Institutions affect fairness: Experimental investigations. Journal of Institutional and Theoretical Economics, 151, 286-303.

    Google Scholar 

  • Frey, B. S., & Oberholzer-Gee, F. (1997). The cost of price incentives: An empirical analysis of motivation crowding-out. American Economic Review, 87, 746-755.

    Google Scholar 

  • Frey, B. S., & Schneider, F. (1997). Warum wird die Umweltökonomie kaum angewendet? Journal of Environmental Law and Policy/Zeitschrift für Umweltpolitik & Umweltrecht, 2, 153-170.

    Google Scholar 

  • Goodin, R. E. (1994). Selling environmental indulgences. Kyklos, 47, 573-596.

    Google Scholar 

  • Gouldner, A. W. (1960). The norm of reciprocity: A preliminary statement. American Sociological Review, 25, 161-178.

    Google Scholar 

  • Grant, R. M. (1996). Toward a knowledge-based theory of the firm. Strategic Management Journal, 17 (Winter Special Issue), 109-122.

    Google Scholar 

  • Hahn, R. W. (1989). The political economy of environment regulation: Towards a unifying framework. Public Choice, 65, 21-47.

    Google Scholar 

  • Hopper, J. R., & Nielsen, J. M. (1991). Recycling as altruistic behavior. Normative and behavioral strategies to expand participation in a community recycling program. Environment and Behavior, 23, 195-220.

    Google Scholar 

  • Ichniowski, C., Shaw, K., & Prennushi, G. (1997). The effects of human resource management practices on productivity: A study of steel finishing lines. American Economic Review, 87, 291-313.

    Google Scholar 

  • Jensen, M. C. (1992). Reputational spillovers, innovation, licensing and entry. International Journal of Industrial Organization, 10, 193-212.

    Google Scholar 

  • Kahneman, D., Slovic, P., & Tversky, A. (Eds.) (1982). Judgement under uncertainty: Heuristics and biases. Cambridge: Cambridge University Press.

    Google Scholar 

  • Kazdin, A. E. (1982). The token economy: A decade later. Journal of Applied Behavioral Analysis, 15, 431-445.

    Google Scholar 

  • Kelman, S. (1981). What price incentives? Economists and the environment. Boston: Auburn.

    Google Scholar 

  • Kirchgässner, G. (1992). Towards a theory of low-cost decisions. European Journal of Political Economy, 8, 305-320.

    Google Scholar 

  • Kliemt, H. (1986). The veil of insignificance. European Journal of Political Economy, 2, 333-344.

    Google Scholar 

  • Ledyard, J. O. (1995). Public goods: A survey of experimental research. In: J. Kagel & A. E. Roth (Eds.), Handbook of experimental economics, pp. 111-194. Princeton: Princeton University Press.

    Google Scholar 

  • Lepper, M. R., & Greene, D. (Eds.) (1978). The hidden costs of reward: New perspectives on the psychology of human motivation. Hillsdale, NY: Erlbaum.

    Google Scholar 

  • Mueller, D. C. (1989). Public choice II (2nd ed.). Cambridge: Cambridge University Press.

    Google Scholar 

  • Mueller, D. C. (Ed.) (1997). Perspectives on public choice. Cambridge: Cambridge University Press.

    Google Scholar 

  • OECD (1994). Integrating environment and economics: The role of economic instruments. Paris: Organisation for Economic Cooperation and Development.

    Google Scholar 

  • Ölander, F., & Thøgersen, J. (1995). Understanding of consumer behaviour as a prerequisite for environmental protection. Journal of Consumer Policy, 18, 345-385.

    Google Scholar 

  • Pittman, T. S., & Heller, J. F. (1987). Social motivation. Annual Review of Psychology, 38, 461-489.

    Google Scholar 

  • Renn, O., Webler, T., & Wiedemann, P. (1995). Competence and fairness in citizen participation. Evaluating models for environmental discourse. Dordrecht: Kluwer.

    Google Scholar 

  • Rousseau, D. M. (1995). Psychological contracts in organizations. Understanding written and unwritten agreements. Thousand Oaks, CA: Sage.

    Google Scholar 

  • Rotter, J. B. (1966). Generalized expectancies for internal versus external control of reinforcement. Psychological Monographs, 80 (1, Whole No. 609).

  • Rummel, A., & Feinberg, R. (1988). Cognitive evaluation theory: A meta-analytic review of the literature. Social Behavior and Personality, 16, 147-164.

    Google Scholar 

  • Schoemaker, P. J. (1982). The expected utility model: Its variants, purposes, evidence and limitations. Journal of Economic Literature, 20, 529-563.

    Google Scholar 

  • Stajkovic, A.D., & Luthans, F. (1997). A meta-analysis of the effects of organizational behavior modification on task performance, 1975–1995. Academy of Management Journal, 40, 1122-1149.

    Google Scholar 

  • Stavins, R. N. (1998). Economic incentives for environmental regulation. In: P. Newman (Ed.), The new Palgrave dictionary of economics and the law, Vol. 2, pp. 6-13. London: Macmillan.

    Google Scholar 

  • Stuart, C. E. (1984). Welfare costs per dollar of additional tax revenue in the United States. American Economic Review, 74, 352-362.

    Google Scholar 

  • Sugden, R. (1989). Spontaneous order. Journal of Economic Perspectives, 3(4), 85-98.

    Google Scholar 

  • Sunstein, C. R. (1997). Free markets and social justice. New York: Oxford University Press.

    Google Scholar 

  • Tang, S.-H., & Hall, C. V. (1995). The overjustification effect: A meta-analysis. Applied Cognitive Psychology, 9, 365-404.

    Google Scholar 

  • Thaler, R. H. (1992). The winner's curse. Paradoxes and anomalies of economic life. New York: Free Press.

    Google Scholar 

  • Thøgersen, J. (1994). Monetary incentives and environmental concern. Effects of a differentiated garbage fee. Journal of Consumer Policy, 17, 407-442.

    Google Scholar 

  • Thorndike, E. L. (1933). An experimental study of rewards. Teachers College Contributions to Education, No. 580.

  • Tietenberg, T. (1985). Emissions trading: An exercise in reforming pollution policy. Washington, DC: Resources for the Future.

    Google Scholar 

  • Weck-Hannemann, H., & Frey, B. S. (1995). Are incentive instruments as good as economists believe? Some new considerations. In: L. Bovenberg & S. Cnossen (Eds.), Public economics and the environment in an imperfect world, pp. 173-186. Dordrecht: Kluwer.

    Google Scholar 

  • Wiersma, U. J. (1992). The effects of extrinsic rewards on intrinsic motivation: A metaanalysis. Journal of Occupational and Organizational Psychology, 65, 101-114.

    Google Scholar 

  • Williamson, O. E. (1975). Markets and hierarchies: Analysis and antitrust implications. New York: Free Press.

    Google Scholar 

Download references

Author information

Authors and Affiliations

  1. Institute of Empirical Economic Research, University of Zurich, Blümlisalpstrasse 10, CH-8006, Zurich, Switzerland. E-mail

    Bruno S. Frey

Authors
  1. Bruno S. Frey
    View author publications

    You can also search for this author in PubMed Google Scholar

Rights and permissions

Reprints and permissions

About this article

Cite this article

Frey, B.S. Morality and Rationality in Environmental Policy. Journal of Consumer Policy 22, 395–417 (1999). https://doi.org/10.1023/A:1006256117094

Download citation

  • Issue Date:

  • DOI: https://doi.org/10.1023/A:1006256117094

Keywords

Search

Navigation