This paper explores the conditions under which a moral disposition is rewarded, in the sense of moral people being more prosperous than amoral people. The analytical framework is a general equilibrium model in which production is more lucrative for moral people than for amoral people, but in which amoral people can choose to be predators rather than producers. We find that, regardless of the advantage that moral people have in production, a moral disposition is rewarded if and only if the ratio

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... of amoral people to moral people is large relative to a parameter that embodies the technology of predation. JEL classiÞcation numbers: A13, D63, D74 We have received helpful comments from Thomas Cosimano, Dmitriy Gershenson, Enrico Spolaore, and anonymous referees. Let us take to be true the popular perception that some people have "moral dispositions" and that other people have "amoral dispositions", these dispositions being exogenously given psychological states. To make these concepts operational, deÞne a person with a moral disposition to be somebody who does not lie, cheat, or steal, no matter how lucrative such behavior might be. In contrast, deÞne a person with an amoral disposition to be somebody who will lie, cheat, and/or steal if, and only if, such behavior is sufficiently lucrative. On these deÞnitions a moral disposition constrains a person's behavior. Accordingly, one might suppose that moral people are not as prosperous as amoral people. This supposition, however, neglects the possibility that production can be more lucrative for moral people than for amoral people and that this advantage in production can more than offset the constraint not to lie, cheat, or steal. Why might moral people have an advantage in production? One possibility is that moral people also behave as if they were more foresighted than amoral people. As a result, moral people accumulate on average more human capital than amoral people. Another possibility, which perhaps is more plausible, is that productive activity is less onerous for moral people than for amoral people. As a result, moral people work harder and produce more than amoral people from the same resource endowment. Still another possibility, which probably is even more plausible, is that, with asymmetric information about the quality of goods and services, potential trading partners prefer to deal with moral people, who are constrained to be trustworthy. As a result, moral people have more exchange opportunities and/or obtain more favorable terms of trade than amoral people. 1 This paper explores the conditions under which a moral disposition is rewarded, in the sense of moral people being more prosperous than amoral people. The analytical framework is a general equilibrium model in which, for whatever reason, production is more lucrative for 1 See Robert Frank (1988) and James Brickley, Clifford Smith, and James Zimmerman (this issue) for extended discussions of this possibility.