1. Home
  2. Topics
  3. Behavioral Economics and Business Ethics
Content element with id 9138

Behavioral Economics and Business Ethics

Behavioral economics shows that people act more morally than the homo economicus model suggests. People are more trustworthy and behave more fairly than many people think. Nevertheless, morality regularly comes into conflict with economic interests, but these conflicts can often be resolved with the help of business ethics.

About the topic

Entrepreneurial profit-seeking and the legitimate interests of society are not always in harmony. However, the conflicts can often be overcome in a constructive way, for example by the state intervening in a regulatory manner (regulatory ethics), by companies assuming responsibility (business ethics) and investing in trust. Or by individuals behaving more morally (individual morality). Typical topics of business ethics are: In the social market economy, the state sets the framework, e.g., for consumer protection, supply chains, and environmental protection; companies maintain their own compliance and corporate social responsibility departments. Individuals volunteer in a variety of ways in society - keyword civic engagement and strengthen social capital. Together, these ways ensure greater prosperity, growth and life satisfaction. Behavioral economics has shown in experiments, among other things, that immoral behavior such as corruption, moonlighting and white-collar crime is a form of corruption.

German Economic Institute (IW) German Economic Institute (IW)

Read the article
The Honesty-Attitude-Behavior Gap: A Cross-Country Comparison
IW-Trends No. 3 29. September 2026 Dominik Enste / Jennifer Potthoff / Augustin Renz

The Honesty-Attitude-Behavior Gap: A Cross-Country Comparison

Honesty reduces transaction costs and is therefore a prerequisite for effective economic cooperation.

Dominik Enste / Jennifer Potthoff / Augustin Renz IW

Read the article
Trends, Influencing Factors and Political Relevance
IW-Trends No. 4 10. January 2026 Jennifer Potthoff / Rebecca Gabel

Life Satisfaction in Germany: Trends, Influencing Factors and Political Relevance

Despite their country’s multiple crises, Germans' subjective well-being remains overall buoyant and is currently reaching historic highs similar to those of the 2010s.

Jennifer Potthoff / Rebecca Gabel IW

Read the article
A Behavioral Ethics Perspective
IW-Policy Paper No. 12 6. November 2025 Barbara Engels / Jennifer Potthoff

Social Media, Markets and Minors: A Behavioral Ethics Perspective

Social media has become a central infrastructure of adolescence, offering benefits such as social connection, informal learning, creative expression, and low-cost entrepreneurial opportunities, while simultaneously posing risks including depression, body image concerns, and opaque commercial persuasion.

Barbara Engels / Jennifer Potthoff IW

Read the article
Gruppe von Freiwilligen, die Lebensmittelspenden auf Tische einer Lebensmittelbank organisieren. Sie arbeiten zusammen und richten Teile des Raumes in einer Kirche ein.
IW-Trends No. 2 1. August 2025 Dominik Enste / Benedict Lorbacher

Anti-Foreign Bias in Germany: A Behavioural Economic Analysis of ist Relevance in Structural Change

While economists never cease to emphasise the overall prosperity gains for society as a whole that result from free trade and globalisation, critical attitudes towards globalisation and support for protectionist policies continue to grow in many Western countries.

Dominik Enste / Benedict Lorbacher IW

Our Experts

View profile
Knut Bergmann

Prof. Dr. Knut Bergmann

Head of Communication and the Branch Office in Berlin

Tel: +49 30 27877-110 Knut Bergmann @knut_bergmann
View profile
Barbara Engels

Barbara Engels

Senior Economist for Sustainable Digitalisation and AI

Tel: +49 221 4981-703 Barbara Engels @BarEngels
View profile
Dominik H. Enste

Prof. Dr. Dominik H. Enste

Head of Democracy, Society & Business Ethics and Managing Director of IW Akademie GmbH

Tel: +49 221 4981-730 Dominik H. Enste @DominikEnste
Content element with id 9139

All news

1542 results
Sort by:
Read study
Critical Choices: How Malaysia and Germany can Navigate Shifting Energy Geostrategy
External Publication 26. October 2026

Critical Choices: How Malaysia and Germany can Navigate Shifting Energy Geostrategy

Stewart Nixon* / Malte Küper in Policy Ideas

Malaysia and Germany, as constructive and reliable participants in globally interdependent energy (as well as trade and financial) markets, face an increasingly hostile, volatile, and uncertain environment surrounding energy choices.

Read study
Fiscal Effects of Having Children
IW-Report No. 43 15. October 2026

Fiscal Effects of Having Children

Wido Geis-Thöne

The fiscal effects of children are relevant to various areas of policymaking.

Read study
Event 14. October 2026 Alexander Radunz

Expert Workshop on the Industrial Accelerator Act

The German Economic Institute (IW) and Frontier Economics are pleased to invite you to a rapporteur & stakeholder workshop on the Industrial Accelerator Act (IAA) in Brussels.

Read study
Universal entitlement, unequal provision: childcare in segregated German cities
External Publication 13. October 2026

Universal entitlement, unequal provision: childcare in segregated German cities

Matthias Diermeier / Jan Engler* / Melinda Fremerey / Leon Wansleben* in Journal of Social Policy

One mechanism driving persistent inequalities in childcare provision, despite rising investments and a substantial expansion of childcare facilities, may consist in the locational choices of providers, who eschew poorer neighbourhoods.

Read study
A Comparison of Public Revenues Across the Federal States
IW-Report No. 41 12. October 2026

A Comparison of Public Revenues Across the Federal States

Björn Kauder

To ensure equivalent living conditions, the federal government influences the revenues of the states and municipalities. Under the fiscal equalization system, financially weak states receive surpluses in the distribution of sales tax revenues, while financially strong states must accept shortfalls.

Read study
German Foreign Investment and the debate over Germany as a business location
IW-Report No. 39 6. October 2026

German Foreign Investment and the debate over Germany as a business location

Samina Sultan / Jürgen Matthes

Geopolitical pressure and the debate over Germany’s competitiveness make it necessary to develop a more precise understanding of German foreign direct investment. This report provides a comprehensive empirical analysis and also examines the implications for Germany as a business location.

Read study
The Honesty-Attitude-Behavior Gap: A Cross-Country Comparison
IW-Trends No. 3 29. September 2026

The Honesty-Attitude-Behavior Gap: A Cross-Country Comparison

Dominik Enste / Jennifer Potthoff / Augustin Renz

Honesty reduces transaction costs and is therefore a prerequisite for effective economic cooperation.

Read study
Event 28. September 2026 Sandra Parthie / Alexander Radunz

Online-Veranstaltungsreihe „Von Brüssel nach Berlin”: Regionalentwicklung und Industriepolitik

Wir laden Sie herzlich zu einer weiteren Online-Veranstaltung unserer Veranstaltungsreihe „Von Brüssel nach Berlin“ ein. Mit ihr wollen wir in loser Folge Themen aus der europäischen in die deutsche Hauptstadt tragen.

Read study
Complementary Capabilities for Circular Practices: Firm-Level Evidence in Germany on the Role of Digitalization and Innovation
External Publication 16. September 2026

Complementary Capabilities for Circular Practices: Firm-Level Evidence in Germany on the Role of Digitalization and Innovation

Sarah Lichtenthäler / Adriana Neligan in Journal of Circular Economy

The transition to a circular economy (CE) requires firms to reconfigure business models, processes and capabilities.

Read study
Making Apprenticeships a Success: From Marketing to Hiring
IW-Report No. 38 11. September 2026

Making Apprenticeships a Success: From Marketing to Hiring

Paula Risius / Dirk Werner / Philip Herzer / Fritz Orange / Regina Flake / Franziska Arndt / Yasin Küçükyavuz / Edgar Schmitz

In-company vocational training is a key factor in securing skilled labour. The first step in investing in future employees is to approach and recruit new apprentices. For many companies, filling the apprenticeship positions they offer is a challenge.

Content element with id 9713