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Public Goods Games, Altruism, and Evolution

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Abstract

How can a desire to cooperate in one-shot interactions survive, even though it gives a material disadvantage to its carrier? I analyze this issue using a one-shot public goods game between two altruistic individuals. Within a pair, the least altruistic individual is better off materially. Between pairs, individuals in the pair with the highest degree of altruism are better off materially. I determine the evolutionarily stable degree of altruism, allowing for assortative matching. The stable degree of altruism is strictly smaller than the degree of assortativity, and it may be negative. It is also increasing in the degree of assortativity. For a given degree of assortativity, the stable degree of altruism depends on the relative strength of the within-pair and the between-group e¤ect on material welfare. This relative strength in turn depends on the production and cost functions in the underlying public goods game.

Suggested Citation

  • Ingela Alger, 2009. "Public Goods Games, Altruism, and Evolution," Carleton Economic Papers 09-06, Carleton University, Department of Economics, revised 01 Feb 2010.
    • Handle: RePEc:car:carecp:09-06
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    More about this item

    Keywords

    public goods; teamwork; altruism; evolution of preferences; evolutionary stability;
    All these keywords.

    JEL classification:

    • D02 - Microeconomics - - General - - - Institutions: Design, Formation, Operations, and Impact
    • D13 - Microeconomics - - Household Behavior - - - Household Production and Intrahouse Allocation

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