A theory of good intentions

by on November 7, 2013 at 7:25 am in Economics, Political Science, Religion, Uncategorized | Permalink

Paul Niehaus has a new paper, and here is the abstract:

Why is other-regarding behavior so often misguided?  I study a new explanation grounded in the idea that altruists want to think they are helping.  Frictions arise because perceptions and reality can diverge ex post, especially when helping remotely (as for example with international development projects).  Among other things the model helps explain why donors have a limited interest in learning about effectiveness, why charities market based on need rather than effectiveness, and why beneficiaries may not be able to do better than to accept this situation.  For policy-makers, the model implies a generic trade-off between quantity and quality of generosity.

When in doubt, self-deception about helping is the next best thing to helping itself, and cheaper to produce.  If I recall properly, the original pointer was from Michael Clemens.

Rich Berger November 7, 2013 at 8:30 am

You need a paper to demonstrate that? Haven’t we known that the road to hell is paved with good intentions? Also, the road to healthcare hell is also paved with good intentions. And a few lies.

Z November 7, 2013 at 9:03 am

I recall characters from Victorian literature that were indifferent to the suffering of those around them, but deeply vexed by the suffering of people in far away lands. it has been too long since I read anything from that period for me to recall the details, but I recall it as a recurring theme. Self-loathing drives all sorts of irrational behavior. People who join mass movements do so out of a desire to swap their identity with that of the group. Contributions to dubious causes are about soothing the guilt of the donor, rather than the intended cause. Less honorable charities have been known to exploit this phenomenon. It seems that some people are willing to commit suicide in order to feel good about themselves. The suicide bomber is, after all, seeking salvation.

Max Factor November 7, 2013 at 9:26 am

“Contributions to dubious causes are about soothing the guilt of the donor, rather than the intended cause.”

Maybe that is true for you but it’s unfair to make that assumption about everyone. Many of the world’s billionaires are spending hundreds of millions of dollars each year on altrusitic causes. Gates spent $1bil on education programs only to recently realize that the quality of the instructor plays a significant role in education. Bloomberg vowed to bounce a check to the undertaker – he donates something like $400mil each year to various causes (e.g. anti-smoking, pro-affordable housing, etc.) and will accelerate his giving as he ages. If you want to argue that these guys are giving away their fortunes because they value being perceived an altruist more than they value the money they are giving away (because they can’t spend everything they have and they can’t take it to the grave) then okay – I can totally get on board with that. But to call these people self-loathing is false – Bloomberg has an ego the size of a blimp. Most wealthy patrons are not self-loathing at all.

Z November 7, 2013 at 9:40 am

Unfair, perhaps, but accurate. Whether or not Bill Gates spends wisely on charity is irrelevant. Your response, however, is an excellent example of the untrained mind struggling with an unpleasant reality. I wonder if that is the cause of all logical fallacies? Regardless, here is a simpler example. The phony-baloney relief concerts staged after a natural disaster are an example of my point. Most people giving the money do so because it makes them feel good, even when they learn it is a waste. Another is the inevitable scams that spring up after the disaster. They rely on the sucker wanting a little grace on the cheap.

Max Factor November 7, 2013 at 10:00 am

It’s well known that there are a lot of fraudulent charities out there. It’s well known that charities spend donor money on overhead and marketing. It’s well known there are no easy answers when it comes to complicated issues surrounding need, poverty, disease, etc. Do you provide the homeless with resources or do you let them fall? What kind of resources do you provide? Etc.

There are many good websites out there that evaluate non-profits and their operations.

I am not untrained in this area – I have several family members who work for non-profits and we frequently discuss cost effectiveness, donor motivation and issues of this nature. Your point is that people are motivated to give by guilt or self loathing. I know from personal and anecdotal evidence that what you claim is not universal.

john personna November 7, 2013 at 10:27 am

What I see is Z being harsh with other people, who he believes are extending their mental model to others, while Z claims his mental model is the only one to extend to other people. (Not terribly self-aware.)

msgkings November 7, 2013 at 10:55 am

What I see is Z justifying a surely total lack of charitable giving. Givers are guilt-ridden and self-loathing, he’s not, so he doesn’t give.

Z November 7, 2013 at 11:04 am

I’ll just note that I never said all giving is good or bad. I merely pointed out that the phenomenon under discussion is driven by a desire for grace on the cheap, which in turn is driven by self-loathing. I’ll note further that this observation has caused panic amongst a predictable cohort. Others can draw whatever conclusions they like, but I suspect I struck a nerve.

john personna November 7, 2013 at 11:13 am

Yeah Z, and the dog which adopts a kitten does so out of self-loathing.

Rahul November 7, 2013 at 11:22 am

@Z: “grace on the cheap”

What’s a not cheap way of earning grace?

msgkings November 7, 2013 at 11:44 am

Classic, Z…
Someone makes a false assertion, others debunk/debate/disagree, same someone declares they ‘struck a nerve’
No, they’re just wrong, and others are pointing that out. No nerves involved.

Cole Skinner November 8, 2013 at 12:01 am

Can you explain how something can be unfair and yet accurate?

“Most people giving the money do so because it makes them feel good, even when they learn it is a waste.”

They ought to feel good for doing their duty, even if they may feel great remorse later that although they held up their end of the bargain, the organizations did not distribute the money effectively. For your argument to be sound, we’d have to assume they would continue to give to a bad organization, which simply does not happen, despite your irrational cynicism.

Your “untrained mind” comment is sophomoric, by the way. How painful it must be to have your godlike intellect offended by all the commoners.

Floccina November 8, 2013 at 9:08 am

Bloomberg vowed to bounce a check to the undertaker – he donates something like $400mil each year to various causes (e.g. anti-smoking, pro-affordable housing, etc.)

Has he ever considered that some people might get enjoyment out of smoking? In his position wouldn’t pushing to allow more building help more?

From the Moldbug November 7, 2013 at 10:44 am

What is callous altruism? Altruism itself is a piece of 20th-century jargon. We could contrast it with the original word for the same thing, obviously too Christian to prosper in our age: charity. When we say charity, of course, we think of empathic altruism.

When we think of charity, we think not just of helping others – but of helping others whom we know and love, for whom we feel a genuine, unforged emotional connection. For whom we feel, in a word, empathy. Understandably, these people tend to be those who are socially close to us. If not people we already know, they are people we would easily befriend if we met them. Dickens, no stranger to genuine empathy, had a term for nonempathic altruism. He called it telescopic philanthropy. Who is Peter Singer? Mrs. Jellyby, with tenure.

So, for example, in classic Bolshevik communism, who is the revolution for? The workers and peasants. But… in classic Bolshevik communism… who actually makes the revolution? Nobles (Lenin) and Jews (Trotsky), basically. To wit, the groups in Russian society who are in fact most distant – emotionally, culturally, socially – from actual workers and peasants.

Similarly, the most passionate anti-racists in America are all to be found, in early September, at Burning Man. Everyone at Burning Man, with hardly an exception, is highly altruistic toward African-Americans. But, to within an epsilon, there are no African-Americans at Burning Man.

But wait, why is this wrong? What’s wrong with nonempathic altruism? Why does it matter to the people being helped if the brains of their helpers genuinely light up in the love lobe, or not? Loved or not, they’re still helped – right? Or are they? How’d that whole Soviet thing work out for the workers and peasants? Heck, for the last 50 years, one of the central purposes of American political life has been advancing the African-American community. And over the last four decades, what has happened to the African-American community?…And since we mentioned Mrs. Jellyby, what exactly has a century of telescopic philanthropy done for Africa?…

Once you learn to recognize the distinction between empathic and nonempathic altruism, you’ll see it everywhere. Empathic altruism – charity – is simply good. Nonempathic altruism – communism – is simply evil. There’s not a whole lot of gray area between good and evil. Evil motivations can certainly, by coincidence, produce good results – but this is an accident, which has little or nothing to do with the supposed “good intentions.”…

When you are motivated by genuine charity, and your charitable efforts backfire and actually harm the recipient of your help, you feel guilt and sorrow like nothing else. You’re a witness to a horrific motorcycle accident. You run over to the man on the ground, pull his helmet off, hug him and give him CPR. Unfortunately, he would have been fine, except that you just severed his spinal cord. How do you feel? Is your reaction: “oh well, at least I tried?”

How did the American people react when their Arab experiment didn’t go so well? I’ll tell you exactly how they reacted. “Oh well, at least we tried.” And then they changed the channel. And that’s what’s wrong with callous altruism.

msgkings November 7, 2013 at 11:03 am

‘Their’ Arab experiment? The Arab Spring happened, and we reacted (or not). Maybe we made some mistakes but it was hardly ‘ours’. And any ‘mistakes’ we can name are really just Monday morning quarterbacking of responses to a chaotic and rapidly changing situation. In other words, let the critics honestly explain what they would have done, with imperfect information, BEFORE the fact.

AC November 7, 2013 at 1:12 pm

Easy: Westphalian international law. Respect sovereignty, stop subsidizing rebels of all stripes with an implicit promise of intervention if they can manipulate the Western media well enough.

Yankuba November 7, 2013 at 11:07 am

“And over the last four decades, what has happened to the African-American community?”

The same thing that has happened to all poor communities. Stagnant wages and growing inequality. I believe that inflation adjusted wages for a caucasian male have dropped by 9% over the past 40 years – that may actually be something TC wrote or said during a podcast. Income expectations for a 2013 college graduate are lower than they were in 2001 – another TC factoid. The poor and the middle class have been getting @#$#$@$ over the past 40 years. The wealth and income gains have flowed to the higher wealth/income brackets. I’m not sure you can lay the blame on the war on poverty. It’s globalization and automation combined with pro-business policies and aggressive corporate lobbying – Average is Over.

“Once you learn to recognize the distinction between empathic and nonempathic altruism, you’ll see it everywhere. Empathic altruism – charity – is simply good. Nonempathic altruism – communism – is simply evil. There’s not a whole lot of gray area between good and evil.”

Seriously, how can you differentiate? Do I give the homeless person food or money or nothing at all? Does it matter if the homeless person is addicted to alcohol? Who makes these determinations? Should we build nuclear power plants in poor nations? Electricity = good but there is a risk for disaster. Nothing is so clear cut!

ThomasH November 7, 2013 at 11:32 am

I don’t see the argument. One wants to think one is helping with self regarding expenditures, too. An incorrect model of how inputs affect outputs leads to bad results in both cases. Whereas part of the difficulty may lie in the greater difficulty in correcting ones model when the results affect other people my guess is that it lies more in the kind of things purchased. It is intrensicaly more difficult to find out the relation between treated mosquito nets and health than it is between the brand of potato chip and it’s flavor, crunchiness, etc.

AC November 7, 2013 at 1:10 pm

The difference is not so much difficulty in measurement (self-deception is definitely a thing too) but how much you care about the outcome once you’ve measured it. Do you feel terrible about a bad outcome, reassess, and change your model accordingly, or do you say “Oh, well at least we tried” or “At least we did the right thing”?

ThomasH November 7, 2013 at 11:33 am

A man once asked a wise Jew about the Jewish Scripture admonition to love neighbor as self by asking who is ones neighbor. The Jew replied with a story about an act of love toward a despised group. After his death a movement grew up around the Jew’s memory, but few members of the organization were able to internalize the point of the story.

TMC November 7, 2013 at 12:11 pm

Yet Catholic Charities is one of the largest provides to the poor in the world, among the thousands of other local efforts by Catholic churches.

Floccina November 8, 2013 at 9:27 am

The one who gave the charity was in the despised group. The act of love was toward to despising group which is more powerful and perplexing. It is as if he said in 1950 USA, a white man was robbed and black man came along and bought him clothes and put him up at a hotel. At the end of the story he says go and do likewise. I think that he means even those who despise you are your neighbors!

Also note that same Jew said the poor will always be with and advocated some charity toward them but the Jew who was robbed in the story was not poor but fell into a calamity.

The story is far more interesting that you described it.

dirk November 7, 2013 at 12:40 pm
john personna November 7, 2013 at 2:59 pm

Very good.

Rahul November 7, 2013 at 10:37 am

I question the hypothesis whether “other-regarding behavior” is any more misguided that any other behavior. I often chose shirts that end up horrid in hindsight. People mis-judge mortgages. People end up in wrong jobs.

Friction between perceptions and reality is not unique to charity alone. Incomplete information, biases, lack of judgement etc. are more universal mistakes.

Steven Kopits November 7, 2013 at 8:39 am

Altruism arises from non-market, indirect transactions. Thus, when I yield my seat to the elderly on the subway, I am not transacting directly with them, but as a agent in a broader system in which the reward will be granted as a function of that agency at some other time (eg, I will be offered the seat when I am old). Thus, in altruism, self-interest prevails, but only in an indirect fashion. Support the system, and the system will support you. This is a socially conservative notion (“He’s such a polite boy!”), with agency the key facilitator, as it is this which makes indirect transactions possible.

Foreign aid has precious little to do with altruism. It is generally pure renting seeking, driven by the self-interest of domestic actors. Foreign aid is the equivalent of fruit cake. No one eats it, but everyone gives it for Christmas (at least they used to). Thus, the act suggests goodwill, but is intended to discharge the obligation of the giver, not meet the needs of the recipient. Foreign aid is like that. Combine it with rent-seeking, and Christmas giving becomes a support program for fruit cake bakers.

Rahul November 7, 2013 at 8:46 am

I don’t get that. Say, when the Tsunami hit Asia, or after Haiti’s earthquake, whatever help the world gave them was “fruitcake” in your books?

I sure saw stories & photos of plenty of recipients enjoying the fruits of the generosity. You can debate about the efficiency etc. but it’s somewhat ridiculous to insist “No one eats it”.

Steven Kopits November 7, 2013 at 2:28 pm

A tsunami is generally an acute situation where necessity trumps more calculated behaviors.

However, I would strongly guess that, if you went to Haiti today, you would find plenty of examples of programs that are driven primarily by domestic US considerations and plenty of necessary programs not funded by the US, which any reasonable analyst would consider desirable.

In the early ’90s, I worked for a USAID sponsored program in Hungary for three years doing privatization work. I can most certainly assure you that we were a fruitcake. The Hungarian government had not requested us, and more or less tolerated us, depending on the individuals and particular point in time. We did not solve any market or non-market imperfection. The Hungarian government was perfectly capable of contracting Goldman Sachs for privatization work when it wanted.

What we did achieve was i) a pretty nice, not too stressful lifestyle for the US consultants involved, and ii) profits for our employer, a KPMG subsidiary. It’s not that we did not strive to do good work or play a constructive role. But it was push, not pull, for our services. Our biggest accomplishment, I think, was our contribution to developing the Budapest restaurant scene. I would say we helped there quite a bit.

GuyS November 7, 2013 at 7:42 pm

Excellent story. I love the fruitcake metaphor, quite applicable.

Rahul November 9, 2013 at 11:57 pm

Some aid may be fruitcake. But not all is. I think that’s what we concluded here.

Choosing an example where the recipient nation does not want your aid is almost axiomatically a recipe for failure.

john personna November 7, 2013 at 9:41 am

My dog will try to cheer up someone who is sad. My dog does not know what “non-market, indirect transactions” are. Dolphins save swimmers. Etc.

(What I’m saying is animal nature includes altruism, that human nature does should be no surprise. And that might lead us to suspect that altruism comes from a more basic place than higher order economic thinking.)

Max Factor November 7, 2013 at 9:50 am

“altruism comes from a more basic place than higher order economic thinking”

Great point. Altruism is also a big part of the major world religions. Sharing is caring!!!

Thomas November 7, 2013 at 10:14 am

Altruism comes from a more “basic place” than self-preservation?

Someone is letting his wishful thinking show.

john personna November 7, 2013 at 10:18 am

You aren’t impressing me Thomas, by answering me with pseudo-quotes of things I did not say. But yes, your dog might just die defending you. I actually had a relative who as an old man slipped on an icy dock. His dog (a Newfoundland, no surprise) jumped in, and dragged him out.

Thomas November 7, 2013 at 8:23 pm

Psuedo-quote? What is (micro) economics except the study of self-preservation? Do you really believe that altruism is better than self-preservation? Do you really believe that altruism is more essential or more ‘basic’ to the human condition than self-preservation? Or, are you posturing to demonstrate your political and ideological affiliation?

iem November 7, 2013 at 10:37 am

“altruism comes from a more basic place than higher order economic thinking”

Kin selection was one of the evolutionary root causes of altruistic emotions. Obviously, it favors the near and the more related over the far and the less related, so it is highly partial. But to some degree, everyone’s related with everyone else (literally) and the instinct served as a bootstrapping mechanism to see the self in the other, which has facilitated other forms of cooperation. Ultimately, that was the cause of the emergence of higher order economic thinking, which would never have come into existence without altruistic base emotions.

john personna November 7, 2013 at 10:42 am

I agree that much altruism (perhaps most) has roots in group survival. I disagree that this means altruism “is economic” or can therefore be fully described in later economic thinking. I think it is much more productive to think of a broad human nature which includes an economic nature, but is not 1:1. And then you don’t have to translate the simple joy of the sun on your skin as a “utility,” etc.

Thomas November 7, 2013 at 8:29 pm

There is an inherent problem is your belief of altruism as sacred cow. Altruism, like anything else, is either beneficial or harmful for the individual performing it; it is either self-interest or sacrifice. In my opinion, the most interest writing by Rand is the discussion of sacrifice. Sacrifice is giving away more than you receive, in totality. If altruism is not self-interested, then it is sacrificial, and therefore, a destroyer of value. No species which inherently strives to sacrifice can survive. Your belief cannot possibly be true. I trust you’ll continue to have faith, however.

Nikki November 7, 2013 at 11:33 am

I don’t mean to undermine your point, but simply as a side note: dolphins don’t intentionally save swimmers. Dolphins play with swimmers. Sometimes they happen to push them towards the shore, and those end up rescued. In other cases the swimmers get pushed in the opposite direction, and we never hear from them again.

john personna November 7, 2013 at 11:38 am

I went looking for general stories, but Google is drowned by repeats of this story: Dolphins save swimmers from shark.

Nikki November 7, 2013 at 12:04 pm

Google is drowned, in 2013, by repeats of a story from 2004 about a group of dolphins that circled about 4-8 centimetres from a group of four swimmers? Do the math.

john personna November 7, 2013 at 12:28 pm

I think both in this and “in other cases the swimmers get pushed in the opposite direction, and we never hear from them again” you are arguing from missing data. That is stories of “saves” is not disproved by missing stories of “non-saves.”

Brian Donohue November 7, 2013 at 12:43 pm

I’m not sure what you mean by altruism, but natural selection, the way I understand it, is not overly-indulgent of self-sacrifice.

Plenty of symbiosis though.

john personna November 7, 2013 at 12:47 pm

Altruism in animals from Wikipedia

Brian Donohue November 7, 2013 at 2:00 pm

Did you read this link? I stand by my comment.

Insurance arrangements, for example, which many of the examples that aren’t specifically related to kin selection represent, are self-interested behavior.

For now, you get a ‘maybe, but still sounds like wishful thinking.’

john personna November 7, 2013 at 2:49 pm

I guess with your second comment I can deduce more about your meaning in “not overly-indulgent of self-sacrifice.” That is, you’ve set a bar that takes a lot of interesting behavior off the table.

john personna November 7, 2013 at 2:51 pm

I mean, have a few of you now set a bar that altruism isn’t altruism unless you seriously risk your life?

I guess putting “tuppence in the old man’s hat” is right out.

Gordon Gekko, Altruist November 7, 2013 at 4:09 pm

I like your low bar better. It includes lots of interesting behavior.

After all, what’s worth doing is worth doing for money.

john personna November 7, 2013 at 4:37 pm

Of course, Gordon. I imagine that you’ve won a charity auction or two, am I right? Right there you’ve got a good mix of people and ambitions, some thinking “of the children (etc.)” and some just wanting to win. Lot of interesting behavior.

Steven Kopits November 7, 2013 at 5:03 pm

As a definitional matter, you cannot do anything against your self-interest unless you are insane. For example, if someone commits suicide, they do it to make themselves feel better (or less worse, more precisely). For this reason, altruism is a problematic concept in economics–it’s just not possible to do something against one’s self-interest.

On the contrary, when you yield your seat on a subway to the elderly (if you were raised with manners), it is obligatory, not voluntary. But you do it anyway (if you have manners). Why would we do this? It is not necessarily empathy; and certainly not desire.

The answer is because we can consider humans either as individuals (principals) or as members of a group with relationships to other members of the group (agents). Thus, there is a split of desire (principal) and duty (agent). When we assume an agent role, our rights and obligations are determined by that agency, not by our individual choice. A wide receiver cannot line up as quarterback. The tight end does not have the right to call the play.

The obligations of each member of the team is determined by the agency role, and they are expected to prioritize that agency role over their individual preferences. That’s what “being a team player” is all about. As a consequence, in a group, there are series of issues that do not arise at the individual level. These include the right to determine the action of the group as a whole; group membership and status; and the allocation of rewards, effort and risk. So, on a football team, the coach gets to call the plays, unless he delegates this authority. The general manager (or coach) gets to select the players. Pay under the salary cap (the allocation of rewards) is determined by the President or GM.

In such an event, the right guard, say, is to protect the quarterback even at risk or cost to himself. It is his duty. This may seem altruistic, but it is his obligation on the team. He has neither the time nor the opportunity in the heat of a play to consider whether he wants to protect the quarterback this time around. He has to be able to respond instantly, on the field as in actual combat. Thus, evolution in a group setting will tend to produce loyalty and commitment–as well as selflessness–because it is necessary to group–not individual–survival. The individual benefits by obtaining the pro rata share of rewards (profits, booty) due to the group as a whole. This is the world of increasing returns to scale and specialization. It is the army or the corporation. In this setting, terms like leadership and loyalty have a meaning which we can characterize as terms used by economists.

In such a setting, unless you are a creationist or believe in random mutations, altruism must have arisen as a result of evolutionary pressures. These pressures are most likely to have evolved in relation to–on the male side–hunting and combat. On the female side, they would have evolved with respect to childrearing. For the group to prosper, the agency role must dominate–at least in some situations. Thus, I would argue that altruism arises as a function of agency, and it is in that context that it is best understood.

Thomas November 7, 2013 at 8:32 pm

+1

Brian Donohue November 8, 2013 at 9:33 am

“Thus, evolution in a group setting will tend to produce loyalty and commitment–as well as selflessness–because it is necessary to group–not individual–survival.”

There’s the rub. This is a heresy, embraced most recently by the estimable E.O. Wilson.

I happen to believe the heretics are wrong, or at least have some proving to do here. It’s not enough to promote group survival- it has to be detrimental to one’s own survival, including kin effects.

The most fruitful places to look for ‘group survival’ strategies to succeed may be in harsh elements, where nature, rather than other creatures, is the main foe.

Back to human behavior. I hate needles. Hate them. But I give blood. Why? I dunno. The fact that, in a Kantian sense, I really feel like I’m not playing any angle here, that in-and-of-itself is the thing that makes me feel good about it. The fact that I hate getting jabbed with needles is like a belt-and-suspenders thing.

But now I go and ruin it by invoking it in an argument on the Internet. Kant is disappoint.

john personna November 7, 2013 at 9:32 am

In many domains (or at least affluent California) time-spend-doing something is valued more highly than cutting a check to accomplish more. There is obviously more feedback for the doer (as happiness research shows) but I personally find it a bit sad, irrational.

john personna November 7, 2013 at 9:45 am

(My friends are not Utilitarians.)

kebko November 7, 2013 at 9:46 am

It’s a modern potlatch. The sacrifice itself is a source of status.

http://idiosyncraticwhisk.blogspot.com/2013/10/sorry-milton-its-free-lunches-we-cant.html

michael November 7, 2013 at 10:02 am

I’ve seen studies which suggest 50% of charitable behavior is driven not by donor’s affinity for the cause, but by the affinity of a friend or relative. Thus it is less about the outcome of charity’s recipients and more about maintaining social bonds of the donor

NPW November 7, 2013 at 10:47 am

An economist’s view of human nature:

Humans are irrational because they don’t always maximize their personal gain.

Humans never give to charity for any other reason than to maximize their personal gain.

Adults’ view of human nature:

People who view selfishness as the only possible human response are goths who never outgrew their teenage stage.

iem November 7, 2013 at 11:11 am

“An economist’s view of human nature:

Humans are irrational because they don’t always maximize their personal gain.”

Did you confuse “an economist” with “an Ayn Rand fanboy”? Because otherwise your assertions make no sense. What is the purpose of these neverending misrepresentations?

john personna November 7, 2013 at 11:15 am

“NPW” is probably shaped by the regularity of the ideal in economics forums. If “Z” is not typical, you can just reassure NPW of that.

NPW November 7, 2013 at 1:02 pm
john personna November 7, 2013 at 1:24 pm

I’ve taken that Ariely course, it certainly does not put the economic view before the humane.

john personna November 7, 2013 at 1:45 pm

(I guess that you misunderstand the behaviorists’ view of “irrationality.” It is not a pejorative. For them it is more like saying something is non-cognitive, not arrived at through conscious logic or processing. A behaviorist can call instinctive sharing “irrational” while thinking it is a very good thing, and very redeeming part of human nature. It is a different sort, a Scrooge in fact, who thinks the impulse is bad no matter its origin.)

mike November 7, 2013 at 2:49 pm

In many cases, behavioral economics could be more accurately described as “quantitative psychology”. The economic assumption of rational profit-maximizing actors is reasonably applied in purely economic transactions such as trading in the stock market. Overgeneralization of the assumption is really not a failure of economists qua economists, but a failure of economists trying to be psychologists.

Yancey Ward November 7, 2013 at 11:24 am

All charity is an economic transaction at an emotional level. The giver is buying admiration and the goodwill of others, and self-esteem from himself- it is as deeply self-interested as the purchase of a new car. That charity scams seem to be nearly immortal things suggests strongly that the true net benefit to the purported recipient is mostly unimportant to the givers, and this disconnect grows faster than the distance between the giver and the recipient.

Some have pointed to the aphorism “The road to hell….”. I offer another- “Charity begins at home.” Helping people effectively is hard work.

john personna November 7, 2013 at 11:30 am

I don’t doubt that economists can try to explain everything, but …

I like to run. My dog likes to run. Sometimes we run together. From what I can tell we both have a very good time.

I believe that economists have very little to offer on this situation.

john personna November 7, 2013 at 11:32 am

(Why do I even “like to run?” Do we need to invent an economic exchange with my future self?)

TMC November 7, 2013 at 12:17 pm

Endorphins. You trade work for pleasure.
Not saying this is the only reason.

TMC November 7, 2013 at 12:18 pm

Crap, I said ‘trade’. Almost sounds economic.

john personna November 7, 2013 at 12:29 pm

;-), yeah. But I bet the “endorphin trade” is old, really old. Much older than cognitive economics.

Thomas November 7, 2013 at 8:36 pm

The endorphin trade or… time to expand the War on Drugs.

iem November 7, 2013 at 11:35 am

But car scams are also nearly immortal things. As long as cars are being sold, there will be car scams. As long as charity is being sold, there will be charity scams.

From my limited knowledge, people seem pretty outraged about charity scams, just like about car scams.

mulp November 7, 2013 at 11:53 am

Of course, the claims by those fighting Obamacare and SNAP benefits and welfare, anti-discrimination laws, etc are obviously motivated by self interest and not helping those they claim to be helping by saving them from the evils of charity and liberal social programs. The real objective of fighting Obamacare and SNAP is to make the poor and sick die faster in order to grab the reources they consume while alive. The real objective of fighting workplace rules like non-discrimination and minimum wage is to restore “slavery by another name”.

The only people you can trust in the opposition to Obamacare, SNAP, minimum wage, et al, are “naturalists” who state, “society needs to be restored to the state of nature with the best dog winning, and survival of the fittest and the killing and eating of the weakest.”

mike November 7, 2013 at 2:50 pm

If they really are as poor as you say, then they don’t have any resources to grab.

GuyS November 7, 2013 at 7:33 pm

I’m inclined to believe most new policies and legislation are constructed to satisfy this altruistic itch of feeling “something is being done”. Generating a feeling something is getting done seems to be more important than any measure of effectiveness.

Analyze any of Obama’s SOTU addresses or speeches. He has mastered the “we passed this law to help out these folks” device, “ObamaCare” being the centerpiece. He has gotten 3 years of credit and re-elected for it, never mind the nightmarish implementation challenges that were known and raised by opposition camps. “I told you so!” has only made Republicans look more sinister, even though they had reasonable objections from the start because the false dichotomy is to do nothing about the problem, which prolongs the guilt.

chuck martel November 7, 2013 at 8:38 pm

The real objective of fighting workplace rules like non-discrimination and minimum wage is to restore “slavery by another name”.
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Karl Marx couldn’t have come up with a comment quite as ludicrous as that.

The Anti-Gnostic November 8, 2013 at 7:30 am

“When in doubt, self-deception about helping is the next best thing to helping itself, and cheaper to produce.”

That’s even better than this one:

“The Good Intentions Paving Company–It’s the thought that counts!”

Who says spergs can’t do satire?

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