No Man is an Island - Social coordination and the Environment

Karine Nyborg 

Memo 07/2019

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Abstract

Humans are fundamentally social. Social activities require coordination, which may yield multiple equilibria in the form of stable, self-reinforcing patterns of herd behavior. Since environmental impacts can differ substantially between alternative equilibria, such self-reinforcing behaviors may, from an environmental perspective, be viewed as representing virtuous or vicious cycles. Environmental policies can help break the self-fulfilling expectations of vicious cycles, tipping the economy to more environment-friendly equilibria.

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Published June 17, 2019 9:45 AM - Last modified June 17, 2019 9:50 AM