Revealed Altruism

51 Pages Posted: 31 Mar 2007

See all articles by James C. Cox

James C. Cox

Georgia State University - Department of Economics

Daniel Friedman

University of California, Santa Cruz - Department of Economics; CESifo (Center for Economic Studies and Ifo Institute)

Vjollca Sadiraj

Georgia State University - Department of Economics

Multiple version iconThere are 2 versions of this paper

Date Written: August 2006

Abstract

This paper develops a nonparametric theory of preferences over one's own and others' monetary payoffs. We introduce more altruistic than (MAT), a partial ordering over preferences, and interpret it with known parametric models. We also introduce and illustrate more generous than (MGT),a partial ordering over opportunity sets. Several recent studies focus on two player extensive form games of complete information in which the first mover (FM) chooses a more or less generous opportunity set for the second mover (SM). Here reciprocity can be formalized as the assertion that an MGT choice by the FM will elicit MAT preferences in the SM. A further assertion is that the effect on preferences is stronger for acts of commission by FM than for acts of omission. We state and prove propositions on the observable consequences of these assertions. Finally, empirical support for the propositions is found in existing data from investment games and from Stackelberg games and in new data from Stackelberg mini-games.

Keywords: Classical preferences, social preferences, convexity, reciprocity, experiments

Suggested Citation

Cox, James C. and Friedman, Daniel and Sadiraj, Vjollca, Revealed Altruism (August 2006). Andrew Young School of Policy Studies Research Paper Series No. 07-14, Available at SSRN: https://ssrn.com/abstract=976030 or http://dx.doi.org/10.2139/ssrn.976030

James C. Cox (Contact Author)

Georgia State University - Department of Economics ( email )

P.O. Box 3992
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Daniel Friedman

University of California, Santa Cruz - Department of Economics ( email )

Social Sciences I
Santa Cruz, CA 95064
United States
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831-459-5900 (Fax)

CESifo (Center for Economic Studies and Ifo Institute)

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Germany

Vjollca Sadiraj

Georgia State University - Department of Economics ( email )

P.O. Box 3992
Atlanta, GA 30302-3992
United States

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