Document Type

Article

Publication Date

1-1-2006

Abstract

This paper develops a nonparametric theory of preferences over oneís own and othersímonetary payo§s. We introduce ìmore altruistic thanî (MAT), a partial ordering over preferences, and interpret it with known parametric models. We also introduce and illustrate ìmore generous thanî(MGT), a partial ordering over opportunity sets. Several recent studies focus on two player extensive form games of complete information in which the Örst mover (FM) chooses a more or less generous opportunity set for the second mover (SM). Here reciprocity can be formalized as the assertion that an MGT choice by the FM will elicit MAT preferences in the SM. A further assertion is that the e§ect on preferences is stronger for acts of commission by FM than for acts of omission. We state and prove propositions on the observable consequences of these assertions. Finally, empirical support for the propositions is found in existing data from investment games and from Stackelberg games and in new data from Stackelberg mini-games.

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To learn more about the Andrew Young School of Policy Studies and ExCEN Working Papers Series, visit https://aysps.gsu.edu/ and http://excen.gsu.edu/center/.

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