Smithian Answers to Some Puzzling Results in the Experimental Literature

Abstract

The Ultimatum Game, Dictator Game and Trust Game are three of the most commonly used environments in economics experiments. In contrast to the predictions of standard rational choice theory, these games generate results that do not show the exclusive presence of self-regarding preferences motivating subjects' behaviors. Adam Smith's attention to both self-regarding and other-regarding preferences, and in particular to the role of resentment, love of praiseworthiness and hate of blameworthiness, provides plausible explanations for these experimental results. This paper draws attention to the increased use and usefulness of Adam Smith with regards to the experimental economic literature.

Keywords: Adam Smith, experiments, Ultimatum Game, Dictator Game, Resentment, Praiseworthiness