The Political Economy of Compliance: Why Do Individuals Obey Collective Rules?

Purpose - To explain why individuals comply with collective rules by integrating multiple theoretical perspectives into a single framework, with applications ranging from tax compliance to public health mandates. Methodology/Approach/Design- Drawing on rational choice theory, institutional economics, and behavioral science, the authors build an agent-based model (ABM) simulating 500 heterogeneous agents across small-world, scale-free, and random networks. The model combines three compliance mechanisms: cost–benefit calculation, institutional trust, and social norm diffusion. Findings- Compliance emerges from the interaction of deterrence, trust, and peer influence rather than any single factor. BeTrust-building interventions prove more cost-effective than enforcement alone, and norm visibility campaigns amplify both. Originality/Value- The study formalizes the micro-foundations of compliance by unifying rational choice, institutional trust, and network diffusion in one computational model, offering actionable in-sights for institutional design.