<p><a href="http://en.wikipedia.org/wiki/Game_theory" rel="nofollow"><strong>Game Theory</strong></a> has principles to contribute, such as the <a href="http://en.wikipedia.org/wiki/Nash_equilibrium" rel="nofollow">Nash Equilibrium</a>.</p>

<blockquote>
  <p>A set of strategies is a Nash equilibrium if each represents a best response to the other strategies. So, if all the players are playing the strategies in a Nash equilibrium, they have no unilateral incentive to deviate, since their strategy is the best they can do given what others are doing.</p>
</blockquote>

<p>Change the incentives in a community, and it can be expected to migrate from one Nash Equilibrium to another.  This would attempt to account for the knock-on or ripple effects, e.g. late pick-up fee makes parents less respectful of the teachers who have to stay late, and resentful teachers make students more cynical, etc.</p>

CC BY-SA 3.0
2013-03-31T18:00:08.087Z
2013-03-31T18:00:08.087Z
Bob Stein
<p>I suspect economics is not the best framework for this because financial incentives are actually very limited in their efficacy in real-world contexts. The example in the question is a good demonstration: the financial incentive was a lot weaker than the social incentive it replaced. <a href="http://en.wikipedia.org/wiki/Applied_psychology" rel="nofollow">Applied Psychology</a> might be a better place to look, in part because it requires a more or less explicit theory of decision-making and behavior change. </p>

CC BY-SA 3.0
2014-05-07T00:46:38.230Z
Economics does not imply financial incentives only.
RJ-
CC BY-SA 3.0
2012-05-07T16:14:09.920Z
2012-05-07T16:14:09.920Z
Dan M.
<p>Having recently read <a href="http://en.wikipedia.org/wiki/Freakonomics" rel="nofollow">Freakonomics</a> I was particularly interested by the idea of the responses of a community to incentives - as an example, the tale of a school which tried to introduce a financial penalty for picking up children late, which inadvertently had the opposite effect, as it nullified the previously existing (but largely invisible) social penalty.</p>

<p>Is there a general theory for this kind of interaction of incentives with community? If so, what is its name, and where could I read more about it? I'm interested in books and papers on a variety of levels, from popular accounts (à la Freakonomics) to textbooks to research papers.</p>

CC BY-SA 3.0
2012-04-25T16:49:19.430Z
@prototoast, yes.  And you could throw in parts of sociology and political science as well.
Michael Bishop
CC BY-SA 3.0
2013-03-31T18:05:22.873Z
If you haven't run across them already, I'd recommend books by **Malcolm Gladwell**, particularly *The Tipping Point*.  It has a competing explanation for the crime drop (less graffiti), though personally I found the Steve's argument more convincing (more abortions).
Bob Stein
<terminology><reference-request><social-psychology>
What is the field that studies community responses to incentives?
Chris Taylor
# What is the field that studies community responses to incentives?

(Asked by: username_0 on 2012-03-24)

Having recently read [Freakonomics](http://en.wikipedia.org/wiki/Freakonomics) I was particularly interested by the idea of the responses of a community to incentives - as an example, the tale of a school which tried to introduce a financial penalty for picking up children late, which inadvertently had the opposite effect, as it nullified the previously existing (but largely invisible) social penalty.

Is there a general theory for this kind of interaction of incentives with community? If so, what is its name, and where could I read more about it? I'm interested in books and papers on a variety of levels, from popular accounts (à la Freakonomics) to textbooks to research papers.

**Tags:** terminology, reference-request, social-psychology

> **Comments:**
> **username_1**: @prototoast, yes.  And you could throw in parts of sociology and political science as well.  
> **username_2**: If you haven't run across them already, I'd recommend books by **Malcolm Gladwell**, particularly *The Tipping Point*.  It has a competing explanation for the crime drop (less graffiti), though personally I found the Steve's argument more convincing (more abortions).  

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## 2 answers

### Answer by username_2 on 2013-03-31. Score: 2

[**Game Theory**](http://en.wikipedia.org/wiki/Game_theory) has principles to contribute, such as the [Nash Equilibrium](http://en.wikipedia.org/wiki/Nash_equilibrium).

> A set of strategies is a Nash equilibrium if each represents a best response to the other strategies. So, if all the players are playing the strategies in a Nash equilibrium, they have no unilateral incentive to deviate, since their strategy is the best they can do given what others are doing.

Change the incentives in a community, and it can be expected to migrate from one Nash Equilibrium to another. This would attempt to account for the knock-on or ripple effects, e.g. late pick-up fee makes parents less respectful of the teachers who have to stay late, and resentful teachers make students more cynical, etc.


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### Answer by username_3 on 2012-05-07. Score: 2

I suspect economics is not the best framework for this because financial incentives are actually very limited in their efficacy in real-world contexts. The example in the question is a good demonstration: the financial incentive was a lot weaker than the social incentive it replaced. [Applied Psychology](http://en.wikipedia.org/wiki/Applied_psychology) might be a better place to look, in part because it requires a more or less explicit theory of decision-making and behavior change.

> **Comments:**
> **username_4**: Economics does not imply financial incentives only.  

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