Hostname: page-component-7dd5485656-jtdwj Total loading time: 0 Render date: 2025-11-02T22:11:29.065Z Has data issue: false hasContentIssue false
  • English
  • Français

THE MORAL BASIS OF PROSPERITY AND OPPRESSION: ALTRUISM, OTHER-REGARDING BEHAVIOUR AND IDENTITY

Published online by Cambridge University Press:  01 July 2010

Kaushik Basu
Kaushik Basu*
Affiliation:
Cornell University
Get access Rights & Permissions [Opens in a new window]

Abstract

Much of economics is built on the assumption that individuals are driven by self-interest and economic development is an outcome of the free play of such individuals. On the few occasions that the existence of altruism is recognized in economics, the tendency is to build this from the axiom of individual selfishness. The aim of this paper is to break from this tradition and to treat as a primitive that individuals are endowed with the ‘cooperative spirit’, which allows them to work in their collective interest, even when that may not be in their self-interest. The paper tracks the interface between altruism and group identity. By using the basic structure of a Prisoner's Dilemma game among randomly picked individuals and building into it assumptions of general or in-group altruism, the paper demonstrates how our selfish rationality interacts with our innate sense of cooperation. The model is used to outline circumstances under which cooperation will occur and circumstances where it will break down. The paper also studies how sub-groups of a society can form cooperative blocks, whether to simply do better for themselves or exploit others.

Information

Type
Essay
Information
Economics & Philosophy , Volume 26 , Issue 2 , July 2010 , pp. 189 - 216
Copyright
Copyright © Cambridge University Press 2010

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

Article purchase

Temporarily unavailable

References

REFERENCES

Akerlof, G. and Kranton, R. 2000. Economics and identity. Quarterly Journal of Economics 115: 715–753.CrossRefGoogle Scholar
Arrow, K. J. 1994. Methodological individualism and social knowledge. American Economic Review 84: 1–10.Google Scholar
Arrow, K. J. 1998. The place of institutions in the economy: a theoretical perspective. In The Institutional Foundations of East Asian Economic Development, ed. Aoki, M. and Hayami, Y.. Basingstoke: Macmillan.Google Scholar
Baliga, S. and Sjostrom, T. 2004. Arms races and negotiations. Review of Economic Studies 71: 351–369.CrossRefGoogle Scholar
Basu, K. 2000. Prelude to Political Economy: A Study of the Social and Political Foundations of Economics. Oxford and New York: Oxford University Press.CrossRefGoogle Scholar
Basu, K. 2005. Racial conflict and the malignancy of identity. Journal of Economic Inequality 3.CrossRefGoogle Scholar
Basu, K. 2006. Gender and say: A model of household decision-making with endogenous balance of power. Economic Journal 116.CrossRefGoogle Scholar
Basu, K. 2007. Coercion, contract and the limits of the market. Social Choice and Welfare 29: 559–579.CrossRefGoogle Scholar
Basu, K. 2008. Methodological individualism. In The New Palgrave Dictionary of Economic, Blume, L. and Durlauf, S.. New York: Palgrave.Google Scholar
Battigalli, P. and Dufwenberg, M. 2005. Dynamic Psychological Games. mimeo: Bocconi University and University of Arizona.CrossRefGoogle Scholar
Benabou, R. and Tirole, J. 2006. Incentives and prosocial behavior. American Economic Review 96: 1652–1679.CrossRefGoogle Scholar
Bernard, J. 1954. The theory of games of strategy as a modern sociology of conflict. American Sociological Review 59: 411–424.CrossRefGoogle Scholar
Blumberg, R. and Coleman, M. 1989. A theoretical look at the gender balance of power in the American couple. Journal of Family Issues 10: 225–250.CrossRefGoogle Scholar
Bowles, S. 2004. Microeconomics: Behavior, Institutions and Evolution. Princeton, NJ: Princeton University Press.Google Scholar
Burns, J. 2004. Race and Trust in Post Apartheid South Africa. mimeo.Google Scholar
Dahrendorf, R. 1959. Class and Class Conflict in Industrial Society. Stanford, CA: Stanford University Press.Google Scholar
Darity, W. A. Jr., Mason, P. L. and Stewart, J. B. 2006. The economics of identity: The origin and persistence of racial identity norms. Journal of Economic Behavior and Organization 60: 283–305.CrossRefGoogle Scholar
Dietrich, F. 2006. Welfarism, Preferencism, Judgementism. mimeo: University of Maastricht.Google Scholar
Eckel, C. C. and Wilson, R. K. 2002. Conditional Trust: Sex, Race and Facial Expressions in a Trust Game. mimeo: Virginia Tech.Google Scholar
Ellingsen, T. and Johannesson, M. 2008. Pride and prejudice: The human side of incentive theory. American Economic Review 98: 990–1008.CrossRefGoogle Scholar
Elster, J. 1989. The Cement of Society. Cambridge: Cambridge University Press.CrossRefGoogle Scholar
Ensminger, J. 2000. Experimental economics in the bush: How institutions matter. In Institutions and Organizations, ed. Menard, C.. London: Edward Elgar.Google Scholar
Fehr, E. and Falk, A. 2002. Psychological foundations of incentives. European Economic Review 46: 687–724.CrossRefGoogle Scholar
Fehr, E. and Gachter, S. 2000. Cooperation and punishment in public goods experiments. American Economic Review 90: 980–994.CrossRefGoogle Scholar
Fershtman, C. and Gneezy, U. 2001. Discrimination in a segmented society: An experimental approach. Quarterly Journal of Economics 116: 351–377.CrossRefGoogle Scholar
Francois, P. 2002. Social Capital and Economic Development. New York: Routledge.CrossRefGoogle Scholar
Frank, R. H., Gilovich, T. and Regan, D. T. 1993. Does studying economics inhibit cooperation? Journal of Economic Perspectives 7: 159–171.CrossRefGoogle Scholar
Fryer, R. and Jackson, M. 2003. Categorical Cognition: A Psychological Model of Categories and Identification in Decision Making. mimeo: Harvard University.CrossRefGoogle Scholar
Fukuyama, F. 1996. Trust: The Social Virtues and the Creation of Prosperity. New York: Free Press.Google Scholar
Gambetta, D. (ed.) 1990. Trust: The Making and Breaking of Cooperative Relations. Oxford: Blackwell.Google Scholar
Gans, H. 1972. The positive functions of poverty. American Journal of Sociology 78: 275–288.CrossRefGoogle Scholar
Ghosh, D. 2005. Terrorism in Bengal: Political Violence in the Interwar Years. mimeo: Cornell University, Department of History.Google Scholar
Gintis, H., Bowles, S., Boyd, R. and Fehr, E. 2003. Explaining altruistic behavior in humans. Evolution and Human Behavior 4: 153–172.CrossRefGoogle Scholar
Glaeser, E., Laibson, D., Scheinkman, J. and Soutter, C. 2000. Measuring trust. Quarterly Journal of Economics 115: 811–846.CrossRefGoogle Scholar
Granovetter, M. 1985. Economic action and social structure: the problem of embeddedness. American Journal of Sociology 91: 481–510.CrossRefGoogle Scholar
Granovetter, M. and Soong, R. 1983. Threshold models of diffusion and collective behavior. Journal of Mathematical Sociology 9: 165–179.CrossRefGoogle Scholar
Hauser, M. D. 2006. Moral Minds. New York: Harper Collins.Google Scholar
Heinrich, J., Boyd, R., Bowles, S., Camerer, C., Fehr, E. and Gintis, H. 2004. Foundations of Human Sociality: Economic and Ethnographic Evidence from Fifteen Small-Scale Societies. Oxford: Oxford University Press.CrossRefGoogle Scholar
Hoff, K. and Pandey, P. 2003. Why are Social Inequalities so Durable? An Experimental Test of the Effects of Indian Caste on Performance. mimeo: The World Bank, Washington.Google Scholar
Hoff, K., Kshetramade, M. and Fehr, E. 2006. Norm Enforcement under Social Discrimination. mimeo: World Bank.Google Scholar
Iversen, V. 2005. Segmentation, Network Multipliers and Spillovers: A Theory of Rural Urban Migration for a Traditional Economy. mimeo: University of East Anglia.Google Scholar
Knack, S. and Keefer, P. 1997. Does social capital have an economy payoff? A cross-country investigation. Quarterly Journal of Economics 112: 1251–1288.CrossRefGoogle Scholar
Levine, D. K. 1998. Modeling altruism and spitefulness in experiments. Review of Economic Dynamics 1: 593–622.CrossRefGoogle Scholar
Loewenstein, G. and O'Donoghue, T. 2005. Animal Spirits: Affective and Deliberative Processes in Economic Behavior. mimeo: Carnegie Mellon University.Google Scholar
Luhman, N. 1979. Trust and Power. Chichester: Wiley.Google Scholar
Luttmer, E. 2001. Group loyalty and the taste for redistribution. Journal of Political Economy 109: 500–528.CrossRefGoogle Scholar
Macy, M. W. 1997. Identity, interest and emergent rationality: An evolutionary synthesis. Rationality and Society 9: 427–448.CrossRefGoogle Scholar
Medema, S. 2009. The Hesitant Hand: Taming Self-Interest in the History of Ideas. Princeton, NJ: Princeton University Press.CrossRefGoogle Scholar
Minkler, L. 2004. Shirking and motivations in firms: Survey evidence on worker attitudes. International Journal of Industrial Organization 22: 863–884.CrossRefGoogle Scholar
Myerson, R. 2004. Justice, institutions, and multiple equilibria. Chicago Journal of International Law 5: 91–107.Google Scholar
Nee, V. and Ingram, P. 1998. Embeddedness and beyond: Institutions, exchange, and social structure. In The New Institutionalism in Sociology, ed. Brinton, M. and Nee, V.. New York: Russell Sage Foundation.Google Scholar
Pettit, P. 1993. The Common Mind: The Essay on Psychology, Society, and Politics. New York: Oxford University Press.Google Scholar
Pettit, P. 2002. Rules, Reasons and Norms. Oxford: Clarendon Press.CrossRefGoogle Scholar
Platteau, J.-P. 2000. Institutions, Social Norms, and Economic Development. Amsterdam: Harwood Academic Publishers.Google Scholar
Qizilbash, M. 2002. Rationality, comparability and maximization. Economics and Philosophy 18: 141–156.CrossRefGoogle Scholar
Rabin, M. 1993. Incorporating fairness into Game Theory and economics. American Economic Review 83: 1281–1302.Google Scholar
Rothschild, E. 2001. Economic Sentiments: Adam Smith, Condorcet, and the Enlightenment. Cambridge, MA: Harvard University Press.Google Scholar
Rubinstein, A. 2006a. A skeptic's comment on the study of economics. Economic Journal 116: C1–C9.CrossRefGoogle Scholar
Rubinstein, A. 2006b. Dilemmas of an economic theorist. Econometrica 4: 865–883.CrossRefGoogle Scholar
Schelling, T. 1972. A process of residential segregation: Neighborhood tipping. In Racial Discrimination in Economic Life, ed. Pascal, A. H.. Lexington, MA: D.C. Heath.Google Scholar
Sen, A. 1974. Choice, orderings and morality. In Practical Reasoning, ed. Korner, S.. Oxford: Blackwell.Google Scholar
Sen, A. 1983. Liberty and social choice. Journal of Philosophy 80: 5–28.CrossRefGoogle Scholar
Sen, A. 2005. The Argumentative Indian: Writings on Indian History, Culture and Identity. London: Penguin Books.Google Scholar
Sen, A. 2006. Identity and Violence: The Illusion of Destiny. New York: Norton & Co.Google Scholar
Sethi, R. and Somanathan, E. 2001. Preference evolution and reciprocity. Journal of Economic Theory 97: 273–297.CrossRefGoogle Scholar
Smith, A. 1759 (1976). The Theory of Moral Sentiments. Indianapolis: Liberty Classics.CrossRefGoogle Scholar
Smith, A. 1776 (1976). An Inquiry into the Nature and Causes of the Wealth of Nations. Oxford: Clarendon Press.Google Scholar
Swedberg, R. 2001. Sociology and Game Theory: Contemporary and historical perspectives. Theory and Society 30: 301–335.CrossRefGoogle Scholar
Tajfel, H. 1974. Social identity and intergroup behavior. Social Science Information 13: 65–93.CrossRefGoogle Scholar
Turner, J. C. 1999. Some current issues in research on social identity and self-categorization theories. In Social Identity, ed. Ellemers, N., Spears, R. and Doosje, B.. Oxford: Blackwell.Google Scholar
Watkins, J. W. N. 1952. The principle of methodological individualism. British Journal for the Philosophy of Science 3: 186–189.CrossRefGoogle Scholar
Weibull, J. 2004. Testing Game Theory. In Advances in Understanding Strategic Behaviour: Game Theory, Experiments and Bounded Rationality, ed. Huck, S.. London: Palgrave MacMillan.Google Scholar
Zelizer, V. 2005. The Purchase of Intimacy. Princeton, NJ: Princeton University Press.Google Scholar