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Revealed Altruism

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Author Info
James C. Cox
Daniel Friedman
Vjollca Sadiraj

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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 such 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 and dictator games, the carrot and stick game, and the Stackelberg duopoly game and in new data from Stackelberg mini-games. Copyright The Econometric Society 2008.

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File URL: http://hdl.handle.net/10.1111/j.1468-0262.2008.00817.x
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Publisher Info
Article provided by Econometric Society in its journal Econometrica.

Volume (Year): 76 (2008)
Issue (Month): 1 (01)
Pages: 31-69
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Handle: RePEc:ecm:emetrp:v:76:y:2008:i:1:p:31-69

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Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Ernst Fehr & Simon Gaechter, . "Fairness and Retaliation: The Economics of Reciprocitys," IEW - Working Papers iewwp040, Institute for Empirical Research in Economics - IEW. [Downloadable!]
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  2. James Cox & Daniel Friedman & Steven Gjerstad, 2004. "A Tractable Model of Reciprocity and Fairness," Experimental 0406001, EconWPA. [Downloadable!]
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  3. Dufwenberg, Martin & Kirchsteiger, Georg, 2004. "A theory of sequential reciprocity," Games and Economic Behavior, Elsevier, vol. 47(2), pages 268-298, May. [Downloadable!] (restricted)
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  4. Huck, Steffen & Muller, Wieland & Normann, Hans-Theo, 2001. "Stackelberg Beats Cournot: On Collusion and Efficiency in Experimental Markets," Economic Journal, Royal Economic Society, vol. 111(474), pages 749-65, October. [Downloadable!] (restricted)
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  5. Gary Charness & Matthew Rabin, 2002. "Understanding Social Preferences with Simple Tests," Department of Economics, Working Paper Series 1042, Department of Economics, Institute for Business and Economic Research, UC Berkeley. [Downloadable!]
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  6. Fehr, Ernst & Kirchsteiger, George & Riedl, Arno, 1993. "Does Fairness Prevent Market Clearing? An Experimental Investigation," The Quarterly Journal of Economics, MIT Press, vol. 108(2), pages 437-59, May. [Downloadable!] (restricted)
  7. Ernst Fehr & Klaus M. Schmidt, 1999. "A Theory Of Fairness, Competition, And Cooperation," The Quarterly Journal of Economics, MIT Press, vol. 114(3), pages 817-868, August. [Downloadable!] (restricted)
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  8. David K. Levine, 1998. "Modeling Altruism and Spitefulness in Experiment," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 1(3), pages 593-622, July. [Downloadable!] (restricted)
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  9. Abbink, Klaus & Irlenbusch, Bernd & Renner, Elke, 2000. "The moonlighting game: An experimental study on reciprocity and retribution," Journal of Economic Behavior & Organization, Elsevier, vol. 42(2), pages 265-277, June. [Downloadable!] (restricted)
  10. Joel Sobel, 2005. "Interdependent Preferences and Reciprocity," Journal of Economic Literature, American Economic Association, vol. 43(2), pages 392-436, June. [Downloadable!] (restricted)
  11. Falk, Armin & Fischbacher, Urs, 2006. "A theory of reciprocity," Games and Economic Behavior, Elsevier, vol. 54(2), pages 293-315, February. [Downloadable!] (restricted)
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  12. Gary E. Bolton & Axel Ockenfels, 2000. "ERC: A Theory of Equity, Reciprocity, and Competition," American Economic Review, American Economic Association, vol. 90(1), pages 166-193, March. [Downloadable!] (restricted)
  13. Berg Joyce & Dickhaut John & McCabe Kevin, 1995. "Trust, Reciprocity, and Social History," Games and Economic Behavior, Elsevier, vol. 10(1), pages 122-142, July. [Downloadable!] (restricted)
  14. Ronald Bosman & Frans van Winden, 2002. "Emotional Hazard in a Power-to-take Experiment," Economic Journal, Royal Economic Society, vol. 112(476), pages 147-169, January. [Downloadable!] (restricted)
  15. James Andreoni & John Miller, 2002. "Giving According to GARP: An Experimental Test of the Consistency of Preferences for Altruism," Econometrica, Econometric Society, vol. 70(2), pages 737-753, March. [Downloadable!] (restricted)
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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Timo Heinrich & Thomas Riechmann & Joachim Weimann, 2009. "Game or frame? Incentives in modified Dictator Games," FEMM Working Papers 09008, Otto-von-Guericke University Magdeburg, Faculty of Economics and Management. [Downloadable!]
  2. Dur, Robert & Sol, Joeri, 2009. "Social Interaction, Co-Worker Altruism, and Incentives," IZA Discussion Papers 4532, Institute for the Study of Labor (IZA). [Downloadable!]
    Other versions:
  3. James C. Cox, 2007. "Trust and Reciprocity: Implications of Game Triads and Social Contexts," Experimental Economics Center Working Paper Series 2007-08, Experimental Economics Center, Andrew Young School of Policy Studies, Georgia State University, revised May 2008. [Downloadable!]
  4. James C. Cox, 2009. "Some Issues of Methods, Theories, and Experimental Designs," Experimental Economics Center Working Paper Series 2009-02, Experimental Economics Center, Andrew Young School of Policy Studies, Georgia State University. [Downloadable!]
  5. Gillies, Anthony S & Rigdon, Mary L, 2008. "Epistemic Conditions and Social Preferences in Trust Games," MPRA Paper 9626, University Library of Munich, Germany. [Downloadable!]
  6. Tasos Kalandrakis, 2008. "Rationalizable Voting," Wallis Working Papers WP51, University of Rochester - Wallis Institute of Political Economy. [Downloadable!]
  7. Peter Duersch & Maroš Servátka, 2009. "Punishment with Uncertain Outcomes in the Prisoner’s Dilemma," Working Papers in Economics 09/12, University of Canterbury, Department of Economics. [Downloadable!]
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  8. Frederico Finan, 2009. "Vote-Buying and Reciprocity," Working Papers id:1882, esocialsciences.com. [Downloadable!]
  9. Shakun Datta Mago & Emmanuel Dechenaux, 2009. "Price leadership and firm size asymmetry: an experimental analysis," Experimental Economics, Springer, vol. 12(3), pages 289-317, September. [Downloadable!] (restricted)
  10. Miettinen, Topi, 2008. "Contracts and Promises - An Approach to Pre-play Agreements," Working Paper Series in Economics and Finance 707, Stockholm School of Economics. [Downloadable!]
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  11. James C. Cox & Maros Servatka & Radovan Vadovic, 2009. "Saliency of Outside Options in the Lost Wallet Game," Experimental Economics Center Working Paper Series 2009-03, Experimental Economics Center, Andrew Young School of Policy Studies, Georgia State University. [Downloadable!]
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  12. Florian Englmaier & Stephen Leider, 2008. "Contractual and Organizational Structure with Reciprocal Agents," CESifo Working Paper Series CESifo Working Paper No. , CESifo Group Munich. [Downloadable!]
  13. Dhaene G. & Bouckaert J., 2007. "Sequential Reciprocity in Two-Player, Two-Stage Games: An Experimental Analysis," Working Papers 2007026, University of Antwerp, Faculty of Applied Economics. [Downloadable!]
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