Prof. Ernst Fehr

Professor of Economics, Affiliated Professor at the UBS Center

Ernst Fehr received his doctorate from the University of Vienna in 1986. His work has shown how social motives shape the cooperation, negotiations and coordination among actors and how this affects the functioning of incentives, markets and organisations. His work identifies important conditions under which cooperation flourishes and breaks down. The work on the psychological foundations of incentives informs us about the merits and the limits of financial incentives for the compensation of employees. In other work he has shown the importance of corporate culture for the performance of firms. In more recent work he shows how social motives affect how people vote on issues related to the redistribution of incomes and how differences in people’s intrinsic patience is related to wealth inequality. His work has found large resonance inside and outside academia with more than 100’000 Google Scholar citations and his work has been mentioned many times in international and national newspapers.

Interests

Development Economics, Education & Health, Behavioral Economics, Neuroeconomics, Economics of Institutions

Professor of Economics, Affiliated Professor at the UBS Center

Prof. Ernst Fehr

Ernst Fehr received his doctorate from the University of Vienna in 1986. His work has shown how social motives shape the cooperation, negotiations and coordination among actors and how this affects the functioning of incentives, markets and organisations. His work identifies important conditions under which cooperation flourishes and breaks down. The work on the psychological foundations of incentives informs us about the merits and the limits of financial incentives for the compensation of employees. In other work he has shown the importance of corporate culture for the performance of firms. In more recent work he shows how social motives affect how people vote on issues related to the redistribution of incomes and how differences in people’s intrinsic patience is related to wealth inequality. His work has found large resonance inside and outside academia with more than 100’000 Google Scholar citations and his work has been mentioned many times in international and national newspapers.

Interests

Development Economics, Education & Health, Behavioral Economics, Neuroeconomics, Economics of Institutions

Selected publications

  • Charles Efferson, Helen Bernhard, Urs Fischbacher, and Ernst Fehr (2024): Super-additive cooperation. Nature. 21 February 2024.

  • Teaching self-regulation with Daniel Schunk, Eva M. Berger, Henning Hermes, and Kirsten Winkel Nature Human Behaviour October 13, 2022 view

  • Preferences predict who commits crime among young men with Thomas Epper, Kristoffer Balle Hvidberg, Claus Thustrup Kreiner, Søren Leth-Petersen, and Gregers Nytoft Rasmussen PNAS February 8, 2022 119 (6) e2112645119 download

  • Behavioral Constraints on the Design of Subgame-Perfect Implementation Mechanisms with Michael Powell and Tom Wilkening. American Economic Review, 111 (4): 1055-91. 2021 download

  • Time Discounting and Wealth Inequality with Thomas Epper, Helga Fehr-Duda, Claus Thustrup Kreiner, David Dreyer Lassen, Søren Leth-Petersen, and Gregers Nytoft Rasmussen. American Economic Review, 110 (4): 1177-1205. 2020 download

  • Behavioral Foundations of Corporate Culture UBS Center Public Paper No.7 2018 download

  • Normative Foundations of Human Cooperation with Ivo Schurtenberger Nature Human Behaviour, 2, 2018, 458-468 download

  • Simple moral code supports cooperation with Charles Efferson Nature (2018) 555(7695):169-170 download

  • Computational and neurobiological foundations of leadership decisions with J. M. Edelson, R. Polania, C.C. Ruff, and T. Hare, Science 2018 download

Research

Ernst Fehr’s research examines the determinants of individuals’ preferences, social norms and the cultures of groups. In addition, he studies the causal consequences of trust and social norms for economic and social behavior. In recent work, Fehr studied whether business cultures facilitate excessive risk taking which seems to have been a serious problem in the financial industry that contributed to the financial crisis in 2008. In other, related work, he has shown that many individuals display countercyclical risk aversion – a finding that can partially explain the large price volatility of financial assets: in financial market booms, individuals become more risk seeking which further feeds the boom while in financial busts they become more risk averse, which further contributes to declining asset prices.

In other recent work, Fehr developed a “high-frequency” measure of social cooperation norms that enable him to study the determinants and the causal consequences of social norms. In this work he shows that a social norm to cooperate completely unravels over time unless it is backed by peer sanctioning – a finding with important consequences for organizations that want to establish a sound cooperative culture. Finally, Fehr also examined the interaction between trust and social institutions. This work shows that in the absence of suitable legal or informal institutions that enable parties to commit to their promises an increase in trust has little consequences, implying that trust alone is not enough to establish a productive and efficient exchange in organizations and markets. However, this work also shows that institutional rules and commitment devices alone are not enough. Both, trust and good institutions are needed to achieve efficient outcomes.

Ernst Fehr’s research examines the determinants of individuals’ preferences, social norms and the cultures of groups. In addition, he studies the causal consequences of trust and social norms for economic and social behavior. In recent work, Fehr studied whether business cultures facilitate excessive risk taking which seems to have been a serious problem in the financial industry that contributed to the financial crisis in 2008. In other, related work, he has shown that many individuals display countercyclical risk aversion – a finding that can partially explain the large price volatility of financial assets: in financial market booms, individuals become more risk seeking which further feeds the boom while in financial busts they become more risk averse, which further contributes to declining asset prices.

In other recent work, Fehr developed a “high-frequency” measure of social cooperation norms that enable him to study the determinants and the causal consequences of social norms. In this work he shows that a social norm to cooperate completely unravels over time unless it is backed by peer sanctioning – a finding with important consequences for organizations that want to establish a sound cooperative culture. Finally, Fehr also examined the interaction between trust and social institutions. This work shows that in the absence of suitable legal or informal institutions that enable parties to commit to their promises an increase in trust has little consequences, implying that trust alone is not enough to establish a productive and efficient exchange in organizations and markets. However, this work also shows that institutional rules and commitment devices alone are not enough. Both, trust and good institutions are needed to achieve efficient outcomes.

Ernst Fehr on Google Scholarbrowse

Videos

In the media

  • Wie wir Entscheidungen treffen Ö1 Radiokolleg 13.3.2024 hören

  • Why reciprocity is common in humans but rare in other animals Nature News and Views on 21.2.2024

  • Why are we nice? Altruism’s origins are put to the test Nature Podcast on 21.2.2024

  • Combination of Group Competition and Repeated Interactions Promotes Cooperation UZH News 23.2.2024 read

  • Early Self-Regulation Boosts Children’s Educational Success UZH press release 13.10.2022 read

  • Verhaltensökonom der Universität Zürich ist von Massentests überzeugt Luzernerzeitung vom 23.2.2021 lesen

  • Warten ist die Antithese zum Kapitalismus – warum wir es dringend wieder lernen sollten BZ Basel vom 9.01.2021 lesen

  • «Wir machen keine Jagd auf Personen ohne Maske» Tagesanzeiger vom 1.11.2020 lesen

  • Verhaltensökonom Fehr: „Wegen Corona gehen Menschen weniger Risiko ein“ Die Presse Interview mit Ernst Fehr vom 24.10.2020 lesen

  • «Testen, testen, testen»? – Kaum ein anderes europäisches Land hat das Testing so schleppend ausgebaut wie die Schweiz NZZ vom 22.10.2020 lesen

  • Diese Ökonomen prägen die Debatte über Corona und anderes – das NZZ-Ranking 2020 NZZ vom 24.9.2020 lesen

  • Die empirische Revolution Weltwoche vom 29.7.2020 lesen

  • «Bei der Quarantäne ist die Gefahr des Trittbrettfahrens gross» Tagesanzeiger Interview mit Ernst Fehr vom 24.7.2020 lesen

  • Top-Ökonom Ernst Fehr: «Unsere Professoren mussten sich selbst entmachten» NZZ am Sonntag Interview vom 4.7.2020 lesen

  • Das Masken-Desaster Beobachter vom 24.6.2020 lesen

  • Nach COVID-19: Richtig vorbereitet in die Zukunft UBS Philantrophie-Webcast mit Ernst Fehr vom 23.5.2020 schauen

  • Star-Ökonom Ernst Fehr kritisiert Landesregierung SonntagsBlick Interview mit Ernst Fehr vom 25.5.2020 lesen

  • Corona-Krise: So wollen Schweizer Ökonomen das Land vom Lockdown befreien NZZ Interview mit Ernst Fehr vom 11.4.2020 lesen

  • «Der Wert eines Menschenlebens ist nicht unendlich gross» Tagesanzeiger Interview vom 1.4.2020 lesen

  • «Unwiderruflicher Schub» – Krise krempelt Wirtschaft um Bluewin Interview vom 27.3.2020 lesen

  • Coronavirus: Ökonom fordert repräsentatives Testing NZZ Video Interview 25.3.2020 schauen

  • «Für die Schweiz bin ich optimistisch» Tagesanzeiger Interview 21.3.2020 lesen

  • «Es braucht eine Klimasteuer – auch auf Fleisch» Tagesanzeiger Interview Januar 2020 lesen

  • Can selfishness be outwitted? SRF Sternstunde Philosophie April 2019 schauen

  • Behavioral Foundations of Corporate Culture Harvard Law School Forum on Corporate Governance and Financial Regulation 12.3.2019 read

  • It is only logical to introduce a CO2 tax NZZ am Sonntag 23.2.2019 lesen

  • Lead or Follow - What Sets Leaders Apart? UZH press release 3.8.2019 read

Quotes

Grossflächiges Testen macht absolut Sinn in der derzeitigen Situation. Man hätte das schon viel früher machen müssen.
Luzernerzeitung, 23.2.2021
Wegen Corona gehen Menschen weniger Risiko ein.
Die Presse, 24.10.2020
Die meisten Leute sind sehr prosozial. Aber das Problem sind heute nicht die wenigen, die keine Maske im öffentlichen Verkehr tragen, sondern jene, die sich nach einer möglichen Infektion nicht in Quarantäne begeben.
Tagesanzeiger, 24.7.2020
Wir haben eine Aufwärtsspirale erzeugt: Unsere renommierten Professoren ziehen die weltbesten Studierenden an. Doch brauchte es dazu eine ziemlich radikale Reform.
NZZ am Sonntag, 4.7.2020
Wir können die COVID-19-Krise dann erfolgreich bewältigen, wenn wir die Kooperation der Bevölkerung haben. Es ist letztlich immer eine Verhaltensfrage.
UBS Philantropie-Webcast, 23.6.2020
Corporate culture has deep and important effects on companies’ overall performance.
Wir berücksichtigen heute nicht alle Umweltkosten, die wir verursachen. Unsere CO2-Emissionen haben aber ernste Folgen für das Klima und schädigen den Planeten. Diese Kosten müssen wir in die Produkte einpreisen und Kostenwahrheit schaffen. Genau das erreicht eine CO2-Steuer.
Was wir derzeit erleben, ist ein enormer Gemeinsinn und, ja, auch Grosszügigkeit – vor allem gegenüber den älteren Menschen
Tagesanzeiger, 1.4.2020

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