Humans display levels of cooperative behavior that contradict the predictions of theoretical models of rational self-interested individuals. We propose a novel technique to discriminate among other-regarding behavior, self-interested strategic play, and decision errors in laboratory experiments. We introduce “virtual players” in two public goods experiments to remove the concerns of human subje...

We introduce a new unified framework for modelling both decision problems and finite games based on quantifiers and selection functions. We show that the canonical utility maximisation is one special case of a quantifier and that our more abstract framework provides several additional degrees of freedom in modelling. In particular, incomplete preferences, non-maximising heuristics, and context-...

When contracting is not possible, a preference for fair exchange can generate efficient exchange, fully exhausting the potential gains from trade — or no exchange at all, leaving all gains from trade unexploited. A profit-maximizing firm offers a wage to a fair-minded worker, who then chooses how much effort to exert. The Rotten Firm theorem says: if the worker cares sufficiently about fairness...

This paper studies the evolution and the co-evolution of both characteristics of reciprocity the willingness to reward friendly behavior and the willingness to punish hostile behavior. Firstly, both preferences for rewarding and preferences for punishing can survive in evolution provided individuals interact within separate groups. This holds even with randomly formed groups and even when indiv...

This paper incorporates compassion into social preferences and tracks individuals’ choices over ten allocation decisions, categorizing participants’ behavior more precisely than previous work. Approximately two-thirds of participants exhibit consistent preferences in all ten exercises and other-regarding individuals are almost evenly split between inequity aversion and social surplus maximizati...

This paper studies the evolution of both characteristics of reciprocity the willingness to reward friendly behavior and the willingness to punish hostile behavior. Firstly, preferences for rewarding as well as preferences for punishing can survive evolution provided individuals interact within separated groups. This holds even with randomly formed groups and even when individual preferences are...

The standard procedure in experimental economics maintains anonymity among laboratory participants, yet many field interactions are conducted with neither complete anonymity nor complete familiarity. When we are involved in interactive situations in the field, we usually have some clues concerning the characteristics of others; however, in some environments (such as e-commerce) these clues may ...

Remittances and Well-Being among Rural-to-Urban Migrants in China The main objective of this paper is to propose a systematic approach to empirically analyse the effect of remittances on the utility of migrants, as proxied by their subjective well-being (SWB). Using data from a new survey on China (RUMiC), we estimate models in which a measure of subjective wellbeing is regressed on the level o...

Behavioral economists have come to recognize that reciprocity, the interaction of trust and trustworthiness, is a distinct and economically relevant component of individual preferences alongside selfishness and altruism. This recognition is principally due to observed decisions in laboratory “trust games”. However, recent research suggests that altruism may explain much of what “looks like” tru...

Aphorisms that “rising tides raise all boats” or that material advances of the rich eventually “trickle down” to the poor are really maxims regarding the nature of stochastic processes that underlay the income/wellbeing paths of groups of individuals. This paper looks at the implications for the empirical analysis of wellbeing of conventional assumptions regarding such processes which are emplo...