THE INFLUENCE OF ETHICAL VALUES ON SOCIO-ECONOMIC DEVELOPMENT: REGRESSION ANALYSIS

Abstract

The article is devoted to the influence of culture and ethical values on the economic indicators of European countries based on the World Values Survey data. The results indicate cultural differences in ethical decision-making depending on economic (sufficient income), social (trust), behavioral, and moral aspects. Ethical and moral values are the basis of individual economic behavior. They create social capital, increase productivity and reduce costs. The economic aspect of ethics is studied in behavioral economics, moral economics, business ethics, management theory, economic culture. It focused on increasing trust and reducing transaction costs. Values are the key elements of the economy as they play a significant role in resource supply, income redistribution, and governance. Understanding the ethical aspects of economic decision-making is serious for shaping the strategy of institution development, economic and social policy. Ethical aspects of economic behavior are payment for public services and understanding the principles of public goods. It also includes a positive attitude towards paying for them, paying taxes, and zero tolerance for bribes. The results of the ethical value investigation are based on the World Values Survey data [1]. The economic and ethical values of payment for public goods, the so-called free-rider problem, are apparent when an individual consciously avoids payment for the public goods or makes efforts to reduce the price. The distinction of public goods is the benefits for all citizens; the consumption of these goods does not reduce their number available for use by other citizens. The danger is that non-payment for the benefits usage of free-riders citizens reduces the motivation to pay the honest. As a result, it decreases the efficiency of the system. The theory and practice of social management indicate that the effectiveness of the group depends on all participants. We can assume that individuals will put less Věda a perspektivy No 2(9) 2022 ISSN 2695-1584 (Print) ISSN 2695-1592 (Online) 42 effort into teamwork or voluntary pay when they see others evading work or payment. Coherence in-group work directly affects community evolution, productivity, and economic outcomes.