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Document Type

Article

Language

English (en)

Publication Date

2023

Publication Title

Reasonableness

Abstract

This paper investigates what makes behavior reasonable. Two actors exert effort towards a goal. The planner knows each actor's cost of effort. The actors know their own cost, but not their counter-party's. We find that the planner will not base incentives on the actors' cost of care (information that is free and accurate). Instead, the planner identifies a common standard of `reasonableness' for many agents to follow to foster coordination and avoid waste. Meanwhile, the planner forgives the least able and holds them to a lower standard customized to their costs, while never upping the standard for the most able.

Keywords

Reasonable Person, Asymmetric Information, Coordination, Task-Specialization.

Publication Citation

Scott Baker & Giri Parameswaran, Reasonableness (Jurisprudence & Legal Philosophy eJournal), https://ssrn.com/abstract=4461500

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