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on Evolutionary Economics |
| By: | James C. Cox; Daniel T. Hall |
| Abstract: | Is mutually beneficial cooperation in trust games more prevalent with private property or common property? Does the strength of property right entitlement affect the answer? Cox, Ostrom, Walker, et al. [1] report little difference between cooperation in private and common property trust games. We assign stronger property right entitlements by requiring subjects to meet a performance quota in a real effort task to earn their endowments. We find that cooperation is lower in common property trust games than in private property trust games, which is an idiosyncratic prediction of revealed altruism theory [2]. |
| Date: | 2010–08 |
| URL: | http://d.repec.org/n?u=RePEc:exc:wpaper:2010-07&r=evo |
| By: | Breitmoser, Yves |
| Abstract: | The paper analyzes econometric models of altruistic giving in dictator and public goods games. Using existing data sets, I evaluate internal and external validity of "atheoretic" regression models as well as structural models of random behavior, random coefficients, and random utility, controlling for subject heterogeneity by finite mixture modeling. In dictator games, atheoretic regression lacks external validity, while random coefficient models and random utility models offer high degrees of both internal and external validity. In public goods games, regression works comparably well, being bettered only by random utility models. Overall, the ordered GEV model of random utility is most appropriate to describe choices in the considered games. |
| Keywords: | structural modeling; altruism; dictator game; public goods; ordered choice sets |
| JEL: | C50 C44 D64 C72 |
| Date: | 2010–08–05 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:24262&r=evo |
| By: | John Duffy; Huan Xie; Yong-Ju Lee |
| Abstract: | Can a social norm of trust and reciprocity emerge among strangers? We investigate this question by examining behavior in an experiment where subjects play a series of indefinitely repeated trust games. Players are randomly and anonymously matched each period. The main questions addressed are whether a social norm of trust and reciprocity emerges under the most extreme information restriction (anonymous community-wide enforcement) or whether trust and reciprocity require additional, individual-specific information about a player’s past history of play and whether that information must be provided freely or at some cost. In the absence of such reputational information, we find that a social norm of trust and reciprocity is difficult to sustain. The provision of reputational information on past individual decisions significantly increases trust and reciprocity, with longer histories yielding the best outcomes. Importantly, we find that making reputational information available at a small cost may also lead to a significant improvement in trust and reciprocity, despite the fact that most subjects do not choose to purchase this information. |
| JEL: | C72 C78 C91 C92 L14 |
| Date: | 2010–08 |
| URL: | http://d.repec.org/n?u=RePEc:pit:wpaper:399&r=evo |
| By: | Martinsson, Peter (Department of Economics, School of Business, Economics and Law, Göteborg University); Myrseth, Kristian Ove R. (ESMT European School of Management and Technology, Berlin, Germany); Wollbrant, Conny (Department of Economics, School of Business, Economics and Law, Göteborg University) |
| Abstract: | When facing the opportunity to allocate resources between oneself and others, individuals may experience a self-control conflict between urges to act selfishly and preferences to act pro-socially. We explore the domain of conditional cooperation, and we test the hypothesis that increased expectations about others’ average contribution increases own contributions to public goods more when self-control is high than when it is low. We pair a subtle framing technique with a public goods experiment. Consistent with our hypothesis, we find that conditionally cooperative behavior is stronger (i.e., less imperfect) when expectations of high contributions are accompanied by high levels of self-control.<p> |
| Keywords: | Self-control; Pro-social behavior; Public good experiment; Conditional cooperation |
| JEL: | D01 D64 D70 |
| Date: | 2010–08–05 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:gunwpe:0459&r=evo |
| By: | Lorenz Goette; David Huffman |
| Abstract: | Traditionally, models of economic decision-making assume that individuals are rational and emotionless. This chapter argues that the neglect of emotion in economic models explains their inability to predict important aspects of the labor market. We focus on one example: the scarcity of nominal wage cuts. [IZA Discussion Paper No. 1895] |
| Keywords: | wage rigidity, affect, emotions, money illusion, loss aversion |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ess:wpaper:id:2743&r=evo |
| By: | Roger D. Congleton |
| Abstract: | This paper analyzes the design, refinement, and evolution of organizational policymaking processes, that is to say, organizational governance. Governance procedures like other aspects of organization are refined through time to advance formeteur interests. Several mechanisms of evolution are explored in this paper. First, formal organizations have a beginning. They are founded. As a consequence, governance templates initially tend to maximize formeteur control over their organizations. Second, formeteurs may subsequently revise the initial distribution of authority. There are often good reasons for formeteurs to exchange some of their initial authority for services and resources that advance organizational interests. Third, there are the constraints of survivorship, which require an organization to attract sufficient resources to be self sustaining. This paper suggests that the results of these processes of refinement tend to be rule-driven, divided governments, many of which will be based on the king and council template. That template facilitates the emergence of relatively effective forms of organizational governance, because it can be adjusted at a large number of margins without changing the essential architecture of governance. |
| Keywords: | Length 37 pages |
| Date: | 2010–07 |
| URL: | http://d.repec.org/n?u=RePEc:esi:evopap:2010-09&r=evo |