Paying it forward.

Paying more when paying for others.

Social behavior is heavily influenced by the perception of the behaviors of others. We considered how perceptions (and misperceptions) of kindness can increase generosity in economic transactions. We investigated how these perceptions can alter behavior in a novel real-life situation that pitted kindness against selfishness. That situation, consumer elective pricing, is defined by an economic t...

Journal of Experimental Psychology: General Paying It Forward: Generalized Reciprocity and the Limits of Generosity

Give What You Get: Capuchin Monkeys (Cebus apella) and 4-Year-Old Children Pay Forward Positive and Negative Outcomes to Conspecifics

The breadth of human generosity is unparalleled in the natural world, and much research has explored the mechanisms underlying and motivating human prosocial behavior. Recent work has focused on the spread of prosocial behavior within groups through paying-it-forward, a case of human prosociality in which a recipient of generosity pays a good deed forward to a third individual, rather than back...

Paying it forward: generalized reciprocity and the limits of generosity.

When people are the victims of greed or recipients of generosity, their first impulse is often to pay back that behavior in kind. What happens when people cannot reciprocate, but instead have the chance to be cruel or kind to someone entirely different--to pay it forward? In 5 experiments, participants received greedy, equal, or generous divisions of money or labor from an anonymous person and ...

Looking Forward to Pricing Options from Binomial Trees

We reconsider the valuation of barrier options by means of binomial trees from a “forward looking” prospective rather than the more conventional “backward induction” one used by standard approaches. This reformulation allows us to write closed-form expressions for the value of European and American put barrier-options on a non-dividend-paying stock.