Benefit Analysis of Environmental Protection Investment Based on Reciprocity Theory

Abstract

This paper abandons the “rational man” hypothesis in traditional economics and utilize s the existing “reciprocal” principal-agent model (Pu Y. J, 2007) to analyze the benefits of environmental protection inputs. The results of the study show that if humans increase their environmental investment on the basis of rational input is set to , naturally, the increase in revenue under the assumption of “reciprocity” is r , when η > 2r , the environmental investment made by humans under irrational assumptions can bring Higher income level than “rational people”. Thus, the enlightenment of government behavior is: first, the government should fully recognize the “reciprocal” characteristics of the natural environment when formulating environmental protection policies; second, the government should further increase investment on the basis of rational input, when the increased investment meets the aforementioned conditions, the purpose of increasing human income can be achieved.