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Comparative statics of altruism and spite

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  • Milchtaich, Igal

Abstract

The equilibrium outcome of a strategic interaction may depend on the weight players place on other playersʼ payoffs or, more generally, on some social payoff that depends on everyoneʼs actions. A positive, negative or zero weight represents altruism, spite or complete selfishness, respectively. As it turns out, even in a symmetric interaction the equilibrium level of social payoff may be lower for a group of altruists than for selfish or spiteful groups. In particular, a concern for othersʼ payoffs may paradoxically lower these payoffs. However, this can only be so if the equilibrium strategies involved are unstable. If they are stable, the social payoff can only increase or remain unchanged with an increasing degree of altruism. In these results, ‘stability’ stands for a general notion of static stability, which includes a number of established ones, such as evolutionarily stable strategy, as special cases.

Suggested Citation

  • Milchtaich, Igal, 2012. "Comparative statics of altruism and spite," Games and Economic Behavior, Elsevier, vol. 75(2), pages 809-831.
  • Handle: RePEc:eee:gamebe:v:75:y:2012:i:2:p:809-831
    DOI: 10.1016/j.geb.2012.02.015
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    References listed on IDEAS

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    Cited by:

    1. Rachmilevitch, Shiran, 2016. "Social objectives in general equilibrium," Economics Letters, Elsevier, vol. 148(C), pages 99-102.

    More about this item

    Keywords

    Altruism; Selfishness; Comparative statics; Strategic games; Static stability;

    JEL classification:

    • C62 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Existence and Stability Conditions of Equilibrium
    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D64 - Microeconomics - - Welfare Economics - - - Altruism; Philanthropy; Intergenerational Transfers

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