Timmy elsewhereJanuary 18, 2015January 18, 2015 Tim WorstallTimmy Elsewhere11 CommentsAt The Register. Pride cometh before a fall n’all that but I reckon that’s a proper job there. previousTimmy elsewherenextMore fun than most economists have and why prostitution must remain legal 11 thoughts on “Timmy elsewhere” Bloke in Germany January 18, 2015 at 12:00 pm But what is so new about the observation? We’ve always had prisons – paid for by us (i.e. at a cost to us) to punish those who treat other people (i.e. not even “us”) unfairly. An in what sense is it economically irrational? If I punish the guy offering a 99/1 split, he will be more inclined to be fair in future. If I accept it, he is likely to continue taking the piss. Even if you know it’s a one-off transaction and you will never deal with each other again, other people might see me as a walk-over if I accept a shoddy deal. Bloke in Germany January 18, 2015 at 12:06 pm Also “poor people can’t afford to be altruistic or insist others are” is not that shocking an observation and it shouldn’t have taken economists so long to realise this. It requires a rose-tinted view of historical poverty in western societies not to realise that altruism is a want, not a need. bloke (not) in spain January 18, 2015 at 12:27 pm It’s worth noting, accepting a dollar when the other guy gets ninety-nine is the basis of getting seriously rich. Pile ’em high ‘n sell ’em cheap. Narrow margins. Might explain why some, from insignificant beginnings, do so very well whilst the better endowed, more mediocre. Gamecock January 18, 2015 at 2:12 pm It is decadence that allows one to refuse the dollar. It is decadence that leads to the demise of Western Civilization. Bernie G. January 18, 2015 at 2:43 pm I’m as honest as the next man (in my experience perhaps more so). But then I have been fortunate in that, one way or another, I’ve always managed to pay the rent. Perhaps if I was an unemployed single parent living in some god-awful place and the kids were hungry…glass houses and all that. I’d like to think in that position I would still be a good boy but you never know until put to the test. It’s much the same way with Tim’s 99/1 proposition…My head says take the $1, my heart says stick it up your backside you tight bastard – I can afford to take offence…I was tapped up on the high street a while ago by a beggar looking for drink money. When I gave him a five-pound note he asked if I could make it a tenner. I suppose if you don’t ask. NiV January 18, 2015 at 2:45 pm “Altruistic punishment”?! If this was true altruism, the guy being offered $1 would say “Sure, and would you like this dollar, too?” That’s altruism. It’s actually that people are playing one round of the *iterated* game, which has a different optimum strategy. The idea is that by refusing ‘unfair’ splits, the other players get to know that this is your strategy, and therefore they will pay you more in the long run because that way they’ll get more too. A dollar is not simply a dollar – it’s only the first of many dollars from many such games. In fact, the game can even work the other way round. If the player who accepts/rejects has a reputation for extreme stubbornness and is known to have a policy of rejecting any split that gives them less than $99, the logic reverses. It’s better to offer $99 because a dollar is a dollar, and if you do anything else you’ll get nothing. The advantage generally goes to the one with the strongest reputation for stubbornness, but it has a price. If you’re playing against a random stranger, you have to assess what the population average is. The first to decide how far they can go and still have the other accept it, the second to decide whether if they’re too stubborn they’ll lose out to less stubborn players who’ll settle for less. It would be interesting to know how accurate the players assessment is. It’s a very complicated game to work out mathematically – it’s impressive that humans seem to be able to work it out subconsciously. Steve January 18, 2015 at 4:45 pm Tim – interesting and thought-provoking article. Well done. Perhaps it says more about my Aspergery, Ayn Rand reading self than it does these studies, but I wondered: is what they’re measuring “altruism”?. As NiV alluded to, isn’t altruistic behavour about giving – without the expectation of receiving? So, giving money for stray kitties and malnourished African babies is altruism, but that’s not what they measured in any of these studies. A very simple reciprocal activity elicited high degrees of altruism in 1- and 2-year-old children Quite. So if the nippers were trained to expect reciprocity, they’re more likely to be helpful to others – because they’ve been led to expect a reward in return. And the ultimatum game. What’s altruistic about denying the other guy $99? To me, it seems like the refusers are motivated by jealousy and the desire to punish others who are “greedy”. They feel they “deserve” a “fair” split of the money – but in truth neither of them earned that money. Surely an altruist would accept that. So is it “altruism” to cut your nose off to spite the other guy? Or is it one of the darker emotions? Re: the difference in behaviours between well off American students and poor people from poor societies – quite. But I bet if you raised the dollar amount – say if you put $10,000 or $100,000 in the pot – the behaviour of US students would converge with that of their Third World counterparts – at least in what they’re willing to accept as a percentage split. Easy to refuse a dollar, or even thirty dollars, when you’ve never gone hungry in your life. But who’s going to turn down, say, $1,000 dollars? Damn few I’d bet. Anyway, if we’re going to measure altruism, I’d suggest an experiment where people are offered either £100 or the same money to go to charity (a proper charity, not one of the government-teat-suckling ones). Replicate that across different socioeconomic groups and societies by amending the £100 to the equivalent based on their wealth and earning expectations. Would be interesting to see the results. Roue le Jour January 19, 2015 at 4:50 am Humans are evolved to live in small groups that are very sensitive to status. A deal that gives you 99 and me 1 raises your status and lowers mine (and indirectly my reproductive options) so I say stuff it. Just visualise yourself walking home from the takeaway while the other guy heads off to a posh restaurant with a pretty girl on each arm. Not gonna happen, amirite? It is status sensitivity that makes the whole relative poverty scam work (aka the crab bucket) and an excellent reason not to have universal democracy. @NiV & Steve It could be seen as status raising to accept no share at all (I don’t need a few dollars but by all means you go ahead) in which case not so altruistic. I would say true altruism is taking pleasure from helping others. Interested January 19, 2015 at 10:20 am @Steve ‘Anyway, if we’re going to measure altruism, I’d suggest an experiment where people are offered either £100 or the same money to go to charity (a proper charity, not one of the government-teat-suckling ones).’ Trouble with this is, you’d actually have to give the money away, and if you’re conducting the experiment in western universities it would rapidly become very costly. In the knowledge that there actually will be no £1,000 / $1,000 forthcoming, most people would probably ‘give it’ to some charity or other. If not most, certainly some, enough (I suggest) to distort the findings. All this ‘research’ relies on people being honest, when people are not honest. It’s like all the various ‘studies’ showing prison doesn’t work. How do we know? We certainly can’t say based on stats – when only five per cent of burglaries (say) end in a conviction, who would know? So instead we ask people in prison, and people in prison say, ‘Oh no, prison won’t stop me committing crime, in fact it’s more lilely to make me commit more.’ And then people like Frances Crook and Paedo Harman and PaulB tell us prison doesn’t work, and smugly point to ‘the evidence’. Squander Two January 19, 2015 at 12:02 pm Interested, > So instead we ask people in prison Quite. See also the studies that show that pornography causes rape. “So, Mr Prisoner, I was wondering whether you brutally raped those fifteen women because you’re an irredeemable sociopathic thug whose key should be thrown away, or was it really all Paul Raymond’s fault?” “Er, is this a trick question?” Squander Two January 19, 2015 at 1:18 pm Sorry, almost forgot. “Anyway, those women were asking for it. They were all dressed as squirrels.” Leave a Reply Cancel replyYour email address will not be published. Required fields are marked *Comment Name * Email * Website Save my name, email, and website in this browser for the next time I comment.