Presents a collection of papers by economists theorizing on the roles of altruism and morality versus self-interest in the shaping of human behavior and institutions. Specifically, the authors examine why some persons behave in an altruistic way without any apparent reward, thus defying the economist's model of utility maximization. The chapters are accompanied by commentaries from representatives of other disciplines, including law and philosophy.

Growing out of a conference on Expectations Formation and Economic Disequilibrium held in New York City in 1981, the papers in this volume provide a complex view of market processes in which individual rationality is no guarantee of convergence to the 'correct' model and the equilibrium coordination of agents' plans. They reject the 'optimality' argument for the rational expectations hypothesis, opening the door to other hypotheses of optimal expectations of agents in the decentralized market economy.

ABSTRACT There are, at present, at least two basic forms of market economy: one that tends to be open to innovative ideas; the other that tends to be more oriented to social services. The normative significance of these two “models” of market society—roughly speaking, the American and the Continental models—can best be appreciated by noticing that in the first model, entrepreneurship, and participation in the economy more generally, can be a major source of satisfaction for the entrepreneurs and employees, independently (...) of their financial compensation. In the second model, the economy is primarily a means to the end of the goods it produces. Although the second type may be as suited to producing goods as the first type, it has fallen short—for reasons that economists now understand—in generating employee engagement and the satisfactions of exploration and self‐realization. (shrink)

This book offers an excellent survey of various macroeconomic topics that feature prominently in the research agenda and have inspired both theoretical and policy debate. The book presents an authoritative and comprehensive summary and original critique of macroeconomic approaches by a scholar whose own contribution to the field is considerable.