Changing Benefits and Costs to Encourage Lawful and Desired Behavior

Abstract

The behavior of individuals, business firms, and government officials can be viewed as stemming from their implicit desire to maximize perceived benefits minus costs, taking into consideration monetary and non-monetary elements and the probability that key events, on which those benefits and costs depend, will occur. This perspective emphasizes that encouraging legally desired behavior requires increasing the benefits and decreasing the costs of doing the right thing, increasing the costs and decreasing the benefits of doing the wrong thing, and favorably influenc ing the probabilities of the key contingent events. Such a perspective can be helpful in generating relevant ideas that might otherwise be overlooked, thought of less quickly, or thought of in a less organized way. One can also avoid ideas that might not be so relevant in that they do not substantially affect relevant benefits and costs. Such a perspective can be contrasted with (1) a regulatory one, which emphasizes government orders, enforcement agencies, and penalties, and (2) a rehabilitative orientation, which emphasizes changing the values of wrongdoers rather than altering the situation so that their values motivate them to engage in lawful behavior.