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The Emotional Consequences of Pro-social Behavior in Markets

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  • Toke Fosgaard

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    (Institute of Food and Resource Economics, University of Copenhagen)

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    Abstract

    Pro-social behavior made when buying private goods is becoming increasingly popular. Several findings from behavioral and experimental economics however emphasizes that people are less pro-social in such situations, compared to pro-social decisions in non-market contexts. This paper suggests that emotional responses are important explanations of this finding. It is first argued that the emotional response to a pro-social decision combined with private good purchase is different from the response to a similar decision in a non-market situation. Through evidence from a laboratory experiment, it is then found, that deciding on a social choice in a market exchange involves a less positive emotional reaction to others, compared to non-market situations. Moreover, subjects in market contexts are found to be less responsive to other subjects’ contribution behavior, relative to the non-market contexts.

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    File URL: http://okonomi.foi.dk/workingpapers/WPpdf/WP2012/WP_2012_1_emotional_consequences.pdf
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    Bibliographic Info

    Paper provided by University of Copenhagen, Department of Food and Resource Economics in its series IFRO Working Paper with number 2012/1.

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    Length: 26 pages
    Date of creation: Dec 2011
    Date of revision:
    Handle: RePEc:foi:wpaper:2012_1

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    Keywords: Emotions; market exchange; pro-social behavior;

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    1. Astrid Hopfensitz & Ernesto Reuben, 2005. "The Importance of Emotions for the Effectiveness of Social Punishment," Discussion Papers 06-09, University of Copenhagen. Department of Economics, revised Mar 2006.
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    15. Hopfensitz, Astrid & Krawczyk, Michal & van Winden, Frans A.A.M., 2008. "Investment, Resolution of Risk, and the Role of Affect," CEPR Discussion Papers 6822, C.E.P.R. Discussion Papers.
    16. Samuel Bowles, 1998. "Endogenous Preferences: The Cultural Consequences of Markets and Other Economic Institutions," Journal of Economic Literature, American Economic Association, vol. 36(1), pages 75-111, March.
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