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Public Goods Games, Altruism, and Evolution

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Abstract

How can a desire to cooperate in one-shot interactions survive, even though it gives a material disadvantage to its carrier? I analyze this issue using a one-shot public goods game between two altruistic individuals. Within a pair, the least altruistic individual is better off materially. Between pairs, individuals in the pair with the highest degree of altruism are better off materially. I determine the evolutionarily stable degree of altruism, allowing for assortative matching. The stable degree of altruism is strictly smaller than the degree of assortativity, and it may be negative. It is also increasing in the degree of assortativity. For a given degree of assortativity, the stable degree of altruism depends on the relative strength of the within-pair and the between-group e¤ect on material welfare. This relative strength in turn depends on the production and cost functions in the underlying public goods game.

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File URL: http://onlinelibrary.wiley.com/doi/10.1111/j.1467-9779.2010.01474.x/pdf
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Bibliographic Info

Paper provided by Carleton University, Department of Economics in its series Carleton Economic Papers with number 09-06.

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Length: 30 pages
Date of creation: 26 Aug 2009
Date of revision: 01 Feb 2010
Publication status: Published: Revised version in Journal of Public Economic Theory, Vol. 12, No. 4 (August 2010), pp. 789–813
Handle: RePEc:car:carecp:09-06

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Keywords: public goods; teamwork; altruism; evolution of preferences; evolutionary stability;

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References

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  1. Ingela Alger & J�rgen W. Weibull, 2010. "Kinship, Incentives, and Evolution," American Economic Review, American Economic Association, American Economic Association, vol. 100(4), pages 1725-58, September.
  2. Jörg Oechssler & Frank Riedel, 2000. "On the Dynamic Foundation of Evolutionary Stability in Continuous Models," Bonn Econ Discussion Papers, University of Bonn, Germany bgse7_2000, University of Bonn, Germany.
  3. Guido Tabellini, 2008. "The Scope of Cooperation: Values and Incentives," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 123(3), pages 905-950, August.
  4. James M. Walker & Matthew A. Halloran, 2004. "Rewards and Sanctions and the Provision of Public Goods in One-Shot Settings," Experimental Economics, Springer, Springer, vol. 7(3), pages 235-247, October.
  5. B. Curtis Eaton & Mukesh Eswaran & Robert J. Oxoby, 2011. "Us and `Them': the origin of identity, and its economic implications," Canadian Journal of Economics, Canadian Economics Association, Canadian Economics Association, vol. 44(3), pages 719-748, August.
  6. Robin P. Cubitt & Michalis Drouvelis & Simon Gächter, 2008. "Framing and Free Riding: Emotional Responses and Punishment in Social Dilemma Games," Discussion Papers, The Centre for Decision Research and Experimental Economics, School of Economics, University of Nottingham 2008-02, The Centre for Decision Research and Experimental Economics, School of Economics, University of Nottingham.
  7. repec:fth:iniesr:557 is not listed on IDEAS
  8. Theodore C. Bergstrom, 2002. "Evolution of Social Behavior: Individual and Group Selection," Journal of Economic Perspectives, American Economic Association, American Economic Association, vol. 16(2), pages 67-88, Spring.
  9. Bester, H. & Güth, W., 1994. "Is altruism evolutionarily stable ?," Discussion Paper, Tilburg University, Center for Economic Research 1994-103, Tilburg University, Center for Economic Research.
  10. Theodore C. Bergstrom, . "On the Evolution of Altruistic Ethical Rules for Siblings," ELSE working papers, ESRC Centre on Economics Learning and Social Evolution 017, ESRC Centre on Economics Learning and Social Evolution.
  11. Jung-Kyoo Choi, 2008. "Play locally, learn globally: group selection and structural basis of cooperation," Journal of Bioeconomics, Springer, Springer, vol. 10(3), pages 239-257, December.
  12. Possajennikov, Alex, 2000. "On the evolutionary stability of altruistic and spiteful preferences," Journal of Economic Behavior & Organization, Elsevier, Elsevier, vol. 42(1), pages 125-129, May.
  13. Bolle, Friedel, 2000. "Is altruism evolutionarily stable? And envy and malevolence?: Remarks on Bester and Guth," Journal of Economic Behavior & Organization, Elsevier, Elsevier, vol. 42(1), pages 131-133, May.
  14. Ellingsen, Tore & Johannesson, Magnus, 2006. "Pride and Prejudice: The Human Side of Incentive Theory," CEPR Discussion Papers, C.E.P.R. Discussion Papers 5768, C.E.P.R. Discussion Papers.
  15. Donald Cox & Bruce E. Hansen & Emmanuel Jimenez, 1997. "How Responsive are Private Transfers to Income? Evidence from a Laissez-Faire Economy," Boston College Working Papers in Economics, Boston College Department of Economics 341., Boston College Department of Economics, revised 01 Dec 1999.
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Cited by:
  1. Alger, Ingela & Cox, Donald, 2012. "The Evolution of Altruistic Preferences: Mothers versus Fathers," IDEI Working Papers, Institut d'Économie Industrielle (IDEI), Toulouse 758, Institut d'Économie Industrielle (IDEI), Toulouse, revised May 2013.
  2. Alger, Ingela & Weibull, Jörgen, 2012. "Homo Moralis-Preference evolution under incomplete information and assortative matching," TSE Working Papers, Toulouse School of Economics (TSE) 12-281, Toulouse School of Economics (TSE).
  3. Ingela Alger & Jörgen W. Weibull, 2010. "Evolutionary Stability, Co-operation and Hamilton’s Rule," Carleton Economic Papers, Carleton University, Department of Economics 10-11, Carleton University, Department of Economics, revised 18 Jan 2011.
  4. Alger, Ingela & Weibull, Jörgen, 2014. "Evolutionarily stable strategies, preferences and moral values, in n-player Interactions," TSE Working Papers, Toulouse School of Economics (TSE) 14-504, Toulouse School of Economics (TSE).
  5. Giacomo Corneo, 2011. "GINI DP 17: Income Inequality, Value Systems and Macroeconomic Performance," GINI Discussion Papers, AIAS, Amsterdam Institute for Advanced Labour Studies 17, AIAS, Amsterdam Institute for Advanced Labour Studies.
  6. repec:aia:ginidp:dp17 is not listed on IDEAS
  7. Alger, Ingela & Weibull, Jörgen, 2014. "Evolutionarily stable strategies, preferences and moral values, in n-player Interactions," IAST Working Papers, Institute for Advanced Study in Toulouse (IAST) 14-10, Institute for Advanced Study in Toulouse (IAST).

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