Other-Regarding Preferences and Social Norms in the Intergenerational Transfer of Renewable Resources when the Agent has Present Biased Preferences

This paper develops a dynamic model of renewable resource management that combines present-biased preferences, intergenerational altruism, and social norm based incentives. The theoretical analysis shows that naïve decision makers, whether individual resource users or public managers, systematically revise their harvesting plans over time, generating resource overexploitation and a smaller intergenerational bequest than originally intended. The paper then introduces a social norm that penalizes deviations from the initially planned sustainable harvesting path and derives two main results. First, the social norm can never worsen the distortion produced by present bias when its marginal disutility is non-decreasing. Second, the analysis identifies a condition on the disutility of social norm violations that fully removes the incentive to revise the sustainable harvesting plan initially chosen. When the condition is satisfied, the social norm functions as a commitment mechanism that restores intertemporal consistency and ensures implementation of the intended intergenerational transfer. The paper concludes by discussing how these findings provide a theoretical basis for using social norms as public policy instruments to support sustainable resource management when self-commitment is limited.