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More Order without More Law: A Theory of Social Norms and Organizational Cultures

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  • Huang, Peter H
  • Wu, Ho-Mou

Abstract

This article applies psychological game theory to study the maintenance of social order. It models the control of corruption in principal-supervisor-agent relationships. The models possess multiple equilibria, which correspond to certain social norms and organizational cultures or their absence. The models demonstrate how expectations concerning the likelihood of corrupt behavior can influence decisions to engage in such behavior via the magnitude of endogenous remorse on the part of the actor. Copyright 1994 by Oxford University Press.

Suggested Citation

  • Huang, Peter H & Wu, Ho-Mou, 1994. "More Order without More Law: A Theory of Social Norms and Organizational Cultures," The Journal of Law, Economics, and Organization, Oxford University Press, vol. 10(2), pages 390-406, October.
    • Handle: RePEc:oup:jleorg:v:10:y:1994:i:2:p:390-406
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