Identity Economics

Akerlof ... and Kranton ... explore the links between our identities and the everyday decisions we make about earning and spending money. Their goal is to add a more personal touch to economics. -- New York Times There is no question monetary incentives are important--indeed critical--but it is important also to consider other meaningful ways to motivate and engage work forces. In a recent book by George Akerlof and Rachel Kranton, Identity Economics, the authors document how people in exceptional organizations work well because they identify with the values and the culture, not simply the financial rewards. -- Al Gore and David Blood, Wall Street Journal [A]n important new book... Professor Akerlof and Rachel Kranton have invented Identity Economics. -- Daniel Finkelstein, The Times Identity Economics is a popular account of work that will already be familiar to economists who have read the authors' journal articles. It is admirably short, written in a clear, nontechnical style but without the condescending breeziness of many books aimed at the airport market. Nonspecialist readers will find a lot of insightful and well-informed analysis of how issues of identity have an impact on real economic problems. -- Robert Sugden, Science The authors make a compelling case that the group with which individuals identify shapes their decisions about schooling, work, savings, investment, and retirement. This paradigm offers better ways of understanding the consequences of public policies and business practices... Identity Economics provides a new language and a useful apparatus to take measure of 'real people in real situations.' -- Barron's Business managers, economists, policy makers, and school administrators will all gain fresh insights into similar enigmas that confront them if they bear the book's message in mind: identity matters. -- ForeWord [A] lucid look at how social considerations carry economic consequences... The authors use the word 'identity' as shorthand for the way people divide themselves into social groups, each of which--like high-school Jocks and Burnouts--has a sense of how to behave. -- James Pressley, Bloomberg News The essence of the book is to place social contexts at the heart of an individual's decision-making. Tastes vary with social context, and concepts such as identity and norms influence the outcome. -- Mint This is a completely new idea, which, in essence, says that one effect of being in an increasingly liberal and affluent society is that aspects of identity that previously didn't seem to matter much to economists are consciously influencing our behaviour. -- Trevor Phillips, Prospect [Akerlof and Kranton] present the material in a very readable and entertaining way. Their findings are that economic behavior is governed by one's social category, by the norms of that social assignment, and by how one views one's identity in that social context. -- Choice [B]y the end of the book, my overwhelming feeling was that the authors had made a pretty robust case for why our profession should pay greater attention to the social structures that underpin our economic decisions. For this, they should be highly commended. -- Samuel Tombs, Business Economist Identity Economics provides the broader, better vision that we need. -- New Economy The book provides a solid basis for a plethora of future research, especially in the field of behavioural economics... Identity economics is a step forward, progressing economic theory and understanding a little further along the path from Homo economicus to Homo sapiens. -- David A. Savage, The Economic Record