Ashamed to Be Selfish, Second Version

37 Pages Posted: 16 Apr 2009

See all articles by David Dillenberger

David Dillenberger

University of Pennsylvania - Department of Economics

Philipp Sadowski

Duke University - Department of Economics

Date Written: April 14, 2009

Abstract

We study a two-stage choice problem. In the first stage, the decision maker (DM) chooses a set of payoff-allocations between herself and a passive recipient. In the second stage, DM chooses an allocation from the set. The recipient is only aware of the second stage choice. Choosing selfishly in the second stage, in the face of a fairer available alternative, may inflict shame on DM. We axiomatize a representation of DM’s preferences over sets that identifies DM’s selfish ranking, her norm of fairness and shame. It has been suggested that altruism is a prominent motive for non-selfish choice. We identify a condition under which shame to be selfish can mimic altruism, when the experimenter only records the second stage choice. An additional condition implies that the norm of fairness can be characterized as the Nash solution of a bargaining game induced by the second-stage choice problem. The representation is applied to a simple strategic situation, a game of trust.

Keywords: Selfishness, Fairness, Shame, Altruism

JEL Classification: C78, D63, D64, D80, D81

Suggested Citation

Dillenberger, David and Sadowski, Philipp, Ashamed to Be Selfish, Second Version (April 14, 2009). PIER Working Paper No. 09-014. Available at SSRN: https://ssrn.com/abstract=1384176 or http://dx.doi.org/10.2139/ssrn.1384176

David Dillenberger (Contact Author)

University of Pennsylvania - Department of Economics ( email )

Ronald O. Perelman Center for Political Science
133 South 36th Street
Philadelphia, PA 19104-6297
United States
215-898-1503 (Phone)

Philipp Sadowski

Duke University - Department of Economics ( email )

213 Social Sciences Building
Box 90097
Durham, NC 27708-0204
United States
919-660-1800 (Phone)

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