The Appearance of Homo Rivalis: Social Preferences and the Nature of Rent Seeking
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Gender Differences in Responsiveness to a Homo Economicus Prime in the Gift-Exchange Game
A Service of Leibniz-Informationszentrum econstor Wirtschaft Leibniz Information Centre Make Your Publications Visible. zbw for Economics Mertins, Vanessa; Warning, Susanne Working Paper Gender differences in responsiveness to a homo economicus prime in the gift-exchange game IAAEU Discussion Paper Series in Economics, No. 09/2013 Provided in Cooperation with: Institute for Labor Law and Relations in the European Union (IAAEU), University of Trier Suggested Citation: Mertins, Vanessa; Warning, Susanne (2013) : Gender differences in responsiveness to a homo economicus prime in the gift-exchange game, IAAEU Discussion Paper Series in Economics, No. 09/2013, University of Trier, Institute for Labour Law and Industrial Relations in the European Union (IAAEU), Trier This Version is available at: http://hdl.handle.net/10419/80863 Standard-Nutzungsbedingungen: Terms of use: Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Documents in EconStor may be saved and copied for your Zwecken und zum Privatgebrauch gespeichert und kopiert werden. personal and scholarly purposes. Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle You are not to copy documents for public or commercial Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich purposes, to exhibit the documents publicly, to make them machen, vertreiben oder anderweitig nutzen. publicly available on the internet, or to distribute or otherwise use the documents in public. Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, If the documents have been made available under an Open gelten abweichend von diesen Nutzungsbedingungen die in der dort Content Licence (especially Creative Commons Licences), you genannten Lizenz gewährten Nutzungsrechte. may exercise further usage rights as specified in the indicated licence. -
Why Social Preferences Matter – the Impact of Non-Selfish Motives on Competition, Cooperation and Incentives Ernst Fehr and Urs Fischbacher
Institute for Empirical Research in Economics University of Zurich Working Paper Series ISSN 1424-0459 forthcoming in: Economic Journal 2002 Working Paper No. 84 Why Social Preferences Matter – The Impact of Non-Selfish Motives on Competition, Cooperation and Incentives Ernst Fehr and Urs Fischbacher January 2002 Why Social Preferences Matter - The Impact of Non-Selfish Motives on Competition, Cooperation and Incentives Ernst Fehra) University of Zurich, CESifo and CEPR Urs Fischbacherb) University of Zürich Frank Hahn Lecture Annual Conference of the Royal Economic Society 2001 Forthcoming in: Economic Journal 2002 Abstract: A substantial number of people exhibit social preferences, which means they are not solely motivated by material self-interest but also care positively or negatively for the material payoffs of relevant reference agents. We show empirically that economists fail to understand fundamental economic questions when they disregard social preferences, in particular, that without taking social preferences into account, it is not possible to understand adequately (i) the effects of competition on market outcomes, (ii) laws governing cooperation and collective action, (iii) effects and the determinants of material incentives, (iv) which contracts and property rights arrangements are optimal, and (v) important forces shaping social norms and market failures. a) Ernst Fehr, Institute for Empirical Research in Economics, University of Zurich, Bluemlisalpstrasse 10, CH-8006 Zurich, Switzerland, email: [email protected]. b) Urs Fischbacher, Institute for Empirical Research in Economics, University of Zurich, Bluemlisalpstrasse 10, CH-8006 Zurich, Switzerland, email: [email protected]. Contents 1 Introduction 1 2 The Nature of Social Preferences 2 2.1 Positive and Negative Reciprocity: Two Examples …............... -
Social Preferences Or Sacred Values? Theory and Evidence of Deontological Motivations
SOCIAL PREFERENCES OR SACRED VALUES? THEORY AND EVIDENCE OF DEONTOLOGICAL MOTIVATIONS Daniel L. Chen and Martin Schonger∗ Abstract Recent advances in economic theory, largely motivated by ex- perimental findings, have led to the adoption of models of human behavior where decision-makers not only take into consideration their own payoff but also others’ payoffs and any potential consequences of these payoffs. Investi- gations of deontological motivations, where decision-makers make their choice not only based on the consequences of a decision but also the decision per se have been rare. We provide a formal interpretation of major moral philosophies and a revealed preference method to distinguish the presence of deontological motivations from a purely consequentialist decision-maker whose preferences satisfy first-order stochastic dominance. JEL Codes: D63; D64; D91; K00 Keywords: Consequentialism, deontological motivations, normative com- mitments, social preferences, revealed preference, decision theory, random lot- tery incentive method ∗Daniel L. Chen, [email protected], Toulouse School of Economics, Institute for Advanced Study in Toulouse, University of Toulouse Capitole, Toulouse, France; Martin Schonger, [email protected], ETH Zurich, Law and Economics. First draft: May 2009. Current draft: January 2020. Latest version available at: http://users.nber.org/∼dlchen/papers/Social_Preferences_or_Sacred_Values.pdf. We thank research assistants and numerous colleagues at several universities and conferences. This project was conducted while Chen received fund- ing from the Alfred P. Sloan Foundation (Grant No. 2018-11245), European Research Council (Grant No. 614708), Swiss National Science Foundation (Grant Nos. 100018-152678 and 106014-150820), Ewing Marion Kauffman Foun- dation, Institute for Humane Studies, John M. -
Kranton Duke University
The Devil is in the Details – Implications of Samuel Bowles’ The Moral Economy for economics and policy research October 13 2017 Rachel Kranton Duke University The Moral Economy by Samuel Bowles should be required reading by all graduate students in economics. Indeed, all economists should buy a copy and read it. The book is a stunning, critical discussion of the interplay between economic incentives and preferences. It challenges basic premises of economic theory and questions policy recommendations based on these theories. The book proposes the path forward: designing policy that combines incentives and moral appeals. And, therefore, like such as book should, The Moral Economy leaves us with much work to do. The Moral Economy concerns individual choices and economic policy, particularly microeconomic policies with goals to enhance the collective good. The book takes aim at laws, policies, and business practices that are based on the classic Homo economicus model of individual choice. The book first argues in great detail that policies that follow from the Homo economicus paradigm can backfire. While most economists would now recognize that people are not purely selfish and self-interested, The Moral Economy goes one step further. Incentives can amplify the selfishness of individuals. People might act in more self-interested ways in a system based on incentives and rewards than they would in the absence of such inducements. The Moral Economy warns economists to be especially wary of incentives because social norms, like norms of trust and honesty, are critical to economic activity. The danger is not only of incentives backfiring in a single instance; monetary incentives can generally erode ethical and moral codes and social motivations people can have towards each other. -
Public Goods Agreements with Other-Regarding Preferences
NBER WORKING PAPER SERIES PUBLIC GOODS AGREEMENTS WITH OTHER-REGARDING PREFERENCES Charles D. Kolstad Working Paper 17017 http://www.nber.org/papers/w17017 NATIONAL BUREAU OF ECONOMIC RESEARCH 1050 Massachusetts Avenue Cambridge, MA 02138 May 2011 Department of Economics and Bren School, University of California, Santa Barbara; Resources for the Future; and NBER. Comments from Werner Güth, Kaj Thomsson and Philipp Wichardt and discussions with Gary Charness and Michael Finus have been appreciated. Outstanding research assistance from Trevor O’Grady and Adam Wright is gratefully acknowledged. Funding from the University of California Center for Energy and Environmental Economics (UCE3) is also acknowledged and appreciated. The views expressed herein are those of the author and do not necessarily reflect the views of the National Bureau of Economic Research. NBER working papers are circulated for discussion and comment purposes. They have not been peer- reviewed or been subject to the review by the NBER Board of Directors that accompanies official NBER publications. © 2011 by Charles D. Kolstad. All rights reserved. Short sections of text, not to exceed two paragraphs, may be quoted without explicit permission provided that full credit, including © notice, is given to the source. Public Goods Agreements with Other-Regarding Preferences Charles D. Kolstad NBER Working Paper No. 17017 May 2011, Revised June 2012 JEL No. D03,H4,H41,Q5 ABSTRACT Why cooperation occurs when noncooperation appears to be individually rational has been an issue in economics for at least a half century. In the 1960’s and 1970’s the context was cooperation in the prisoner’s dilemma game; in the 1980’s concern shifted to voluntary provision of public goods; in the 1990’s, the literature on coalition formation for public goods provision emerged, in the context of coalitions to provide transboundary pollution abatement. -
The Social Side of Homo Economicus
TREE-1308; No. of Pages 3 Update Forum The social side of Homo economicus Daniel J. Rankin1,2 1 Department of Biochemistry, University of Zu¨ rich, Building Y27, Winterthurerstrasse 190, CH-8057 Zu¨ rich, Switzerland 2 Swiss Institute of Bioinformatics, Quartier Sorge Baˆ timent Ge´ nopode, CH-1015 Lausanne, Switzerland Many recent experiments in the field of behavioural cooperatively than traditional economic theory would pre- economics appear to demonstrate a willingness of dict [1,11]. humans to behave altruistically, even when it is not in their interest to do so. This has led to the assertion that Are humans especially cooperative? humans have evolved a special predisposition towards Cooperation in public goods games is unstable and most altruism. Recent studies have questioned this, and dem- players quickly realise that not contributing maximises onstrated that selfless cooperation does not hold up in their profit (see Figure 1 for an explanation of public controlled experiments. As I discuss here, this calls for goods games). Despite this, the public goods game fre- more economic ‘field experiments’ and highlights the quently results in higher levels of contribution than one need for greater integration of the evolutionary and would expect if individuals were selfishly rational and economic sciences. 10% of participants contribute in the long run [1,12]. This has led to the conclusion that humans have a special Kto nekradne, okra´da svoju rodinu degree of cooperation, or ‘other regarding preferences’, (He who does not steal, steals from his family) that cannot be explained from a purely selfish perspec- Slovak Saying tive and that has been used as evidence that humans behave more cooperatively than theory would predict The apparent puzzle of human cooperation [1,12]. -
Preferences Under Pressure
Eric Skoog Preferences Under Pressure Conflict, Threat Cues and Willingness to Compromise Dissertation presented at Uppsala University to be publicly examined in Zootissalen, EBC, Villavägen 9, Uppsala, Friday, 13 March 2020 at 10:15 for the degree of Doctor of Philosophy. The examination will be conducted in English. Faculty examiner: Associate Professor Thomas Zeitzoff (American University, School of Public Affairs). Abstract Skoog, E. 2020. Preferences Under Pressure. Conflict, Threat Cues and Willingness to Compromise. Report / Department of Peace and Conflict Research 121. 66 pp. Uppsala: Department of Peace and Conflict Research. ISBN 978-91-506-2805-0. Understanding how preferences are formed is a key question in the social sciences. The ability of agents to interact with each other is a prerequisite for well-functioning societies. Nevertheless, the process whereby the preferences of agents in conflict are formed have often been black boxed, and the literature on the effects of armed conflict on individuals reveals a great variation in terms of outcomes. Sometimes, individuals are willing to cooperate and interact even with former enemies, while sometimes, we see outright refusal to cooperate or interact at all. In this dissertation, I look at the role of threat in driving some of these divergent results. Armed conflict is rife with physical threats to life, limb and property, and there has been much research pointing to the impact of threat on preferences, attitudes and behavior. Research in the field of evolutionary psychology has revealed that threat is not a singular category, but a nuanced phenomenon, where different types of threat may lead to different responses. -
Walrasian Economics in Retrospect
A Service of Leibniz-Informationszentrum econstor Wirtschaft Leibniz Information Centre Make Your Publications Visible. zbw for Economics Bowles, Samuel; Gintis, Herbert Working Paper Walrasian Economics in Retrospect Working Paper, No. 2000-04 Provided in Cooperation with: Department of Economics, University of Massachusetts Suggested Citation: Bowles, Samuel; Gintis, Herbert (2000) : Walrasian Economics in Retrospect, Working Paper, No. 2000-04, University of Massachusetts, Department of Economics, Amherst, MA This Version is available at: http://hdl.handle.net/10419/105719 Standard-Nutzungsbedingungen: Terms of use: Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Documents in EconStor may be saved and copied for your Zwecken und zum Privatgebrauch gespeichert und kopiert werden. personal and scholarly purposes. Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle You are not to copy documents for public or commercial Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich purposes, to exhibit the documents publicly, to make them machen, vertreiben oder anderweitig nutzen. publicly available on the internet, or to distribute or otherwise use the documents in public. Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, If the documents have been made available under an Open gelten abweichend von diesen Nutzungsbedingungen die in der dort Content Licence (especially Creative Commons Licences), you genannten Lizenz gewährten Nutzungsrechte. may exercise further usage rights as specified in the indicated licence. www.econstor.eu WALRASIAN ECONOMICS IN RETROSPECT∗ Department of Economics University of Massachusetts Amherst, Massachusetts, 01003 Samuel Bowles and Herbert Gintis February 4, 2000 Abstract Two basic tenets of the Walrasian model, behavior based on self-interested exogenous preferences and complete and costless contracting have recently come under critical scrutiny. -
Striking a Blow for Sanity in Theories of Rationality
Published in: M. Augier & J. G. March (Eds.). (2004). Models of a man: Essays in memory of Herbert A. Simon (pp. 389– 409). Cambridge, MA: MIT Press. © 2004 MIT Press. Striking a Blow for Sanity in Theories of Rationality Gerd Gigerenzer I took the title of this chapter from an email Herbert A. Simon sent me in May 1999. In this email, he wrote a statement for the back cover of Simple Heuristics That Make Us Smart in which he commented: “I think the book strikes a great blow for sanity in the approach to rationality [and shows] why more than minor tampering with existing optimization theory is called for.” But Herb wouldn’t be Herb if he hadn’t added “and you wouldn’t believe I had ever skimmed the volume if I didn’t fi nd SOMETHING to disagree with.” And so he continued, pointing out that he hadn’t found the expert/novice topic treated, that scientifi c discovery would have been a great example for ill-structured domains … Bringing sanity into theories of rationality was a major guideline in Herbert Simon’s scientifi c life. However, as he himself was prepared to admit, sanity in rationality entered his thinking as a negatively defi ned concept, a kind of black box that contained everything that was not optimiza- tion. What he opposed has various names: full rationality, substantial rationality, maximization of expected utility, Homo economicus, or simply optimization. What he proposed had its seeds in his revised dissertation, Administrative Behavior (1947), and eventually became termed bounded rationality, satisfi cing, or procedural rationality. -
Estimating Social Preferences Using Stated Satisfaction: Novel Support for Inequity Aversion
DISCUSSION PAPER SERIES IZA DP No. 14347 Estimating Social Preferences Using Stated Satisfaction: Novel Support for Inequity Aversion Lina Diaz Daniel Houser John Ifcher Homa Zarghamee APRIL 2021 DISCUSSION PAPER SERIES IZA DP No. 14347 Estimating Social Preferences Using Stated Satisfaction: Novel Support for Inequity Aversion Lina Diaz John Ifcher George Mason University Santa Clara University and IZA Daniel Houser Homa Zarghamee George Mason University Barnard College APRIL 2021 Any opinions expressed in this paper are those of the author(s) and not those of IZA. Research published in this series may include views on policy, but IZA takes no institutional policy positions. The IZA research network is committed to the IZA Guiding Principles of Research Integrity. The IZA Institute of Labor Economics is an independent economic research institute that conducts research in labor economics and offers evidence-based policy advice on labor market issues. Supported by the Deutsche Post Foundation, IZA runs the world’s largest network of economists, whose research aims to provide answers to the global labor market challenges of our time. Our key objective is to build bridges between academic research, policymakers and society. IZA Discussion Papers often represent preliminary work and are circulated to encourage discussion. Citation of such a paper should account for its provisional character. A revised version may be available directly from the author. ISSN: 2365-9793 IZA – Institute of Labor Economics Schaumburg-Lippe-Straße 5–9 Phone: +49-228-3894-0 53113 Bonn, Germany Email: [email protected] www.iza.org IZA DP No. 14347 APRIL 2021 ABSTRACT Estimating Social Preferences Using Stated Satisfaction: Novel Support for Inequity Aversion In this paper, we use stated satisfaction to estimate social preferences: subjects report their satisfaction with payment-profiles that hold their own payment constant while varying another subject’s payment. -
Monitoring Accuracy and Retaliation in Infinitely Repeated Games with Imperfect Private Monitoring: Theory and Experiments
CIRJE-F-795 Monitoring Accuracy and Retaliation in Infinitely Repeated Games with Imperfect Private Monitoring: Theory and Experiments Hitoshi Matsushima University of Tokyo Tomohisa Toyama Kogakuin University April 2011 CIRJE Discussion Papers can be downloaded without charge from: http://www.cirje.e.u-tokyo.ac.jp/research/03research02dp.html Discussion Papers are a series of manuscripts in their draft form. They are not intended for circulation or distribution except as indicated by the author. For that reason Discussion Papers may not be reproduced or distributed without the written consent of the author. 1 Monitoring Accuracy and Retaliation in Infinitely Repeated Games with Imperfect Private Monitoring: 1 Theory and Experiments Hitoshi Matsushima Department of Economics, University of Tokyo2 Tomohisa Toyama Faculty of Engineering, Kogakuin University April 2, 2011 Abstract This paper experimentally examines infinitely repeated prisoners’ dilemma games with imperfect private monitoring and random termination where the probability of termination is very low. Laboratory subjects make the cooperative action choices quite often, and make the cooperative action choice when monitoring is accurate more often than when it is inaccurate. Our experimental results, however, indicate that they make the cooperative action choice much less often than the game theory predicts. The subjects’ naïveté and social preferences concerning reciprocity prevent the device of regime shift between the reward and punishment phases from functioning in implicit collusion. JEL Classification Numbers: C70, C71, C72, C73, D03. Keywords: Infinitely Repeated Prisoners’ Dilemma, Imperfect Private Monitoring, Experimental Economics, Monitoring Accuracy, Social Preference, Generous Tit-for-Tat. 1This paper is a revised version of a part of our earlier unpublished paper (jointly authored with Mr. -
WELFARE CRITERIA Witih ENDOGENOUS PREFERENCES: the ECONOMICS of EDUCATION*
iNTERNATIONAL ECONOMIC REVIEW Vol. 15, No. 2, Jtune, 1974 WELFARE CRITERIA WITIh ENDOGENOUS PREFERENCES: THE ECONOMICS OF EDUCATION* BY HERBERT GINTIS1 1. INTRODUCTION "BY ACTING on the external world and changing it," Karl Marx once re- marked, "[the worker] at the same time changes his own nature." [18, (197-98)] Much of Marxist theory is a development of this basic observation. The special position in Marxist theory of economic structure, its conception of materialism, of ideology, of classes and of social change, hinge on this connection. Indeed, again to quote Marx, "the whole of history is nothing but a continual transfor- mation of human nature" [19, (160)]. It is less than happenstance that the major competitor to Marxist theory, the tradition culminating in modern neo-classical economics, is grounded firmly not merely in the abstraction from, but the negation of this insight. The Marxist observation, translated into neo-classical terminology, holds that individual pref- erence structures are products of economic activity. Or more precisely, indi- vidual preferences develop and change according to variables endogenous to the economic model: prices, quantities, and availabilities of consumption goods, jobs, and the social institutions conditioning the supply of labor. Neo-classical theory starts from the contrary position: the Walrasian system takes preferences as either fixed, or changirngonly in response to variables external to the model. In positive economics, the formationi of preferences is relegated to sociology or social psychology; and in welfare economics, preference structures are amonig the fundamiiental,unexplained data. In the words of Harrod [13], The method of procedure is to take certain elements of the structure as given-namely the preference lists of individuals for goods and services, the terms on which they are willing to contribute their assistance to production and the current state of technologyy..