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Directed Altruism and Enforced Reciprocity in Social Networks

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  • Rosenblat, Tanya
  • Mobius, Markus

Abstract

We conduct online field experiments in large real-world social networks in order to decompose prosocial giving into three components: (1) baseline altruism toward randomly selected strangers, (2) directed altruism that favors friends over random strangers, and (3) giving motivated by the prospect of future interaction. Directed altruism increases giving to friends by 52 percent relative to random strangers, while future interaction effects increase giving by an additional 24 percent when giving is socially efficient. This finding suggests that future interaction affects giving through a repeated game mechanism where agents can be rewarded for granting efficiency enhancing favors. We also find that subjects with higher baseline altruism have friends with higher baseline altruism.

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Bibliographic Info

Paper provided by Iowa State University, Department of Economics in its series Staff General Research Papers with number 13025.

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Date of creation: 01 Feb 2009
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Publication status: Published in Quarterly Journal of Economics, November 2009, vol. 124 no. 4, pp. 1815-1851
Handle: RePEc:isu:genres:13025

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Postal: Iowa State University, Dept. of Economics, 260 Heady Hall, Ames, IA 50011-1070
Phone: +1 515.294.6741
Fax: +1 515.294.0221
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Web page: http://www.econ.iastate.edu
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Related research

Keywords: social networks; modified dictator games; directed altruism; enforced reciprocity;

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References

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  1. Gary Charness & Matthew Rabin, 2002. "Understanding Social Preferences With Simple Tests," The Quarterly Journal of Economics, MIT Press, vol. 117(3), pages 817-869, August.
  2. 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.
  3. Kovarik, Jaromir & Espinosa Alejos, María Paz & Brañas Garza, Pablo & Jiménez, Natalia & Ponti, Giovanni & Cobo Reyes, Ramón, 2009. "Altruism and Social Integration," IKERLANAK 2009-35, Universidad del País Vasco - Departamento de Fundamentos del Análisis Económico I.
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    • Kovarik, Jaromir & Espinosa Alejos, María Paz & Brañas Garza, Pablo & Jiménez, Natalia & Ponti, Giovanni & Cobo Reyes, Ramón, 2009. "Altruism and Social Integration," DFAEII Working Papers 2009-05, University of the Basque Country - Department of Foundations of Economic Analysis II.
  4. Quoc-Anh Do & Stephen Leider & Markus M. Mobius & Tanya Rosenblat, 2009. "What Do We Expect from Our Friends?," Working Papers 09-2009, Singapore Management University, School of Economics.
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  9. Rabin, Matthew, 1993. "Incorporating Fairness into Game Theory and Economics," American Economic Review, American Economic Association, vol. 83(5), pages 1281-1302, December.
  10. Quoc-Anh Do & Stephen Leider & Markus M. Mobius & Tanya Rosenblat, 2008. "Directed Altruism and Enforced Reciprocity in Social Networks," Working Papers 17-2008, Singapore Management University, School of Economics.
  11. David Marmaros & Bruce Sacerdote, 2006. "How Do Friendships Form?," The Quarterly Journal of Economics, MIT Press, vol. 121(1), pages 79-119, 02.
  12. Udry, Christopher, 1994. "Risk and Insurance in a Rural Credit Market: An Empirical Investigation in Northern Nigeria," Review of Economic Studies, Wiley Blackwell, vol. 61(3), pages 495-526, July.
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