Market Functioning and Social Rules

Abstract

In economic literature growing attention has been paid to the role of social norms as they can mould the mode of individual interaction within the economic systems, both by affecting their behaviour in the form of external constraints or incentives and by influencing the way they perceive the external world, their learning processes. Given the widespread interest in these issues, the objective of the paper is to analyse how social rules can favour the exchange process among individuals within the market, following the literature on this topic. In particular, their cognitive dimension is taken into consideration, as they can shape agents' decision-making processes in order to improve the outcomes of their interactions.