Question

1. How do social preferences shape society and the economy?
2. Where do social preferences play an important role in the economy? Give an example and explain.
3. Can you think of an example of social preference that is harmful to certain groups of people? Explain.
4. Are social preferences and social norms related? If so, how? If not, why?

Answer 1

A social preference in economics tells the preferences of an individual and all those collective preferences form the preferences of the society. They then form the demand of the goods and services, which later will be supplied by the producers accordingly. Hence the social preferences shape the economy and society.

Preferences play an important role when deciding the rule or the decision make in a country. Each individual has a preference regarding who they should vote and all the individual preferences make up one decision.

Example, In India it was illegal to be homosexual. And this social preference was harmful for the LGBT community.

The social norms form the social preference in the society. Because people are influenced by the prevailing norm and on the basis of that norm they decide what their preference should be.