Behavioural economics shows that people act more morally than the model of homo economicus would suggest. Nevertheless, conflicts between morality and economic interests do frequently occur and in many cases they can be resolved with the help of business ethics.

Companies’ pursuit of profit and the legitimate interests of society are not always in harmony. However, constructive solutions to the conflicts which occur can often be found, for example by regulatory intervention on the part of the state (regulatory ethics), by enterprises shouldering more responsibility (corporate ethics), and by individuals behaving more morally (individual morals).

Behavioural economists have demonstrated experimentally that moral behaviour is not the exception. They have discovered systematic deviations from the image of the utility- and profit-maximizing homo economicus: People reward fair, and punish unfair, behaviour, for example, even at a cost to themselves.

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Der Begriff Corporate Social Responsibility (CSR) umschreibt die Verantwortung der Unternehmen für die Gesellschaft.

Nach den Finanz- und Wirtschaftskrisen und dem unmoralischen Handeln Einzelner fordert die Gesellschaft mehr mitverantwortliches Handeln von den Unternehmen. Gesellschaftliches Engagement soll neben das Hauptziel von Unternehmen treten, Konsumentenwünsche zu befriedigen und damit Gewinne zu erwirtschaften. Im Fokus stehen neben den Anteilseignern (Shareholdern) auch die Stakeholder, also Mitarbeiter, Kunden, Zulieferer und die Gesamtgesellschaft.

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Behavioural economics deals with human behaviour in economic situations. One conclusion drawn from this discipline is that people frequently act contrary to the widely-accepted model of man as homo economicus.

Behavioural economists have shown that the concept of man as homo economicus does not always correspond to the reality. Their experiments reveal systematic deviations from this image of the rational utility- and profit-maximizer: for example, people reward fair, and punish unfair, behaviour even at a cost to themselves. Behavioural economics investigates irrational behaviour and examines social norms, those forms of behaviour which are accepted by the majority of society. To this end, it combines traditional economic approaches with psychological methods.

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While trust and satisfaction in life are as closely related as trust and economic growth, mistrust can provoke or aggravate crises – such as the Euro crisis.

A strong society is based on sound social capital – trust, relationships and norms. Trust in the political system, the economy, and societal structures encourage economic growth and prosperity. It enables economic exchanges such as work contracts and purchases. In companies, a corporate culture based on trust can lead to a better reputation and long-term success, and improve the employees’ satisfaction.

Trust is hardly missed until it’s gone. However, the Euro crisis has demonstrated what happens when trust fades inside the banking sector: Increasingly mistrusting each other, banks have made lending more difficult. As a consequence, financing costs for companies have increased and investments stagnated, slowing down economic growth in Europe. The trust index analyses how trust has developed in Europe and how different countries compare today in terms of trust levels.

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Business ethics examine the ways in which conflicts between a society’s moral demands and economic requirements can be solved.

According to the theories, markets and morals do not have to disagree: Because of the market’s “invisible hand”, the sum of individual economic choices increases the overall welfare. A baker for instance does not primarily bake for altruistic reasons, but in order to make a living.

Instances exist in which conflicts arise between entrepreneurial pursuit of profit and a society’s legitimate interests. However, these can be resolved in a constructive manner. The government can intervene with regulations (systemic ethics), companies can act responsibly (corporate social responsibility) and individuals can act morally (individual moral).

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A healthy and trusting person, content with his or her job and maintaining strong family ties, is generally satisfied with life.

Surveys show that half of the German population considers itself to be extremely satisfied in life. This assessment changes during the span of a lifetime. Young people and older persons about to or recently retired are particularly content. Persons age 50 to 60 or older than 80 are generally less satisfied.

Stark differences exist between the employed and the unemployed. Yet, a job’s significance does not only depend on the size of one’s income. People work for more reasons than to simply earn a living: The right job enables them to create and to shape, and integrates them into social networks.

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When people buy something or sign contracts, they don't always act to their own advantage. Consumer protection thus means protecting consumers not only from producers but also from themselves.

Previously, consumer protection measures relied primarily on informing consumers. If people had detailed knowledge of a product’s features, it was assumed, they would make the right decision. However, empirical research conducted by behavioural economists has shown that there are limits to human rationality and these also apply to purchasing decisions. For example, there is often a surfeit of information which prevents people from recognising the important criteria. Modern consumer protection therefore also takes into account this problem of restricted rationality. The idea behind it is to continue leaving decisions to the consumers – but to improve them.

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