Forgiveness, Tit for Tat, and the Coase Theorem

Forgiveness reduces the price of transgression; or, demand curves slope down. As discussed by the WSJ:

…research shows forgiveness has a dark side. At first it may help the person who has been hurt to let go of anger, resentment and desire for revenge. But forgiving also may encourage the transgressor to do it again.

Jim McNulty, a psychology professor at Florida State University…found that the day after forgiving a partner, people were 6.5 times more likely to report that the partner had again done something negative, compared with when there was no forgiveness.

… “The potential cost of forgiveness is that it doesn’t hold the partner accountable for the behavior,” Dr. McNulty says.

If you find yourself forgiving your partner a lot then something is wrong but forgiving is not always the wrong strategy. What should you do? Tit for tat looks good in the cooperative equilibrium but can go badly wrong with error and mistake. That’s one reason why it’s good to forgive error and even the occasional transgression if you think you can get back on track.

In another study, people who forgave nice partners remained happy with their marriages, while people who forgave not-so-nice partners became less happy.

Tit for tat seems draconian, however, because you really shouldn’t model a marriage as a prisoner’s dilemma.

My own approach is to think of the Coase theorem. Assume that you can’t redistribute happiness or wealth within the marriage. If your spouse is unhappy you will be unhappy and if your spouse is happy you are likely to be happy; happy wife, happy life. If you can’t redistribute happiness the play to make is to maximize total happiness. Maximizing total happiness means accepting apparent reductions in happiness when those result in even larger increases in happiness for your spouse. If you maximize the total, however, there will be more to go around and the reductions will usually be temporary.

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