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Human Nature and Economics
Articles
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The Riddle of the Human Species
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By E.O. Wilson
Energy and Climate on the White House Agenda
Rethinking Mill and Paternalism
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Mill, who believed that each individual is in a unique
position to know what’s in her best interest, concluded
that government may coerce citizens to refrain only
from acts that are hazardous to others, and has no
warrant for regulating an individual’s behavior.
Whether this view is correct is, Sunstein claims, “an
empirical question,” and recent research in cognitive
psychology has seemed to show that in fact, we aren’t
so good at choosing what’s best for us.
Good and Bad
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Write a list of 5 behaviors characteristic of a good
person
Write list of 5 behaviors characteristic of a bad
person
Why Study Human Nature?
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To what extent are desirable ends constrained by
human nature?
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To what extent are allocative mechanisms
constrained by human nature?
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Insatiability
Biophilia (ecophilia)
Fairness and concern for others
Attitudes towards the future
Are we inherently competitive, cooperative, or both?
Are we rational, emotional, or both?
Are people the same everywhere?
Will Competition or Cooperation
Solve Society’s Current Crises?
What is the conventional economic
model of human nature?
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Homo-economicus
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Self-interested
Insatiable
Rational
Competitive
Is this closer to your depiction of a good person or
a bad person?
Are People Rational?
Split into two groups. Group 2
leave room
Group 1
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Serious flu will kill 6000 people
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Choice A: Conventional vaccine will save 2000 people
Choice B: Experimental vaccine has 1/3 chance of
saving everyone, 2/3 chance of saving no one
Mark your choice and leave room
Group 2
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Serious flu will kill 6000 people
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Choice A: Conventional vaccine will result in death of
4000 people
Choice B: Experimental vaccine has 1/3 chance of
saving everyone, 2/3 chance of saving no one
Mark your choice
Are People Rational or Emotional?
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Context: social security
#, health care
Losses vs. gains
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WTP vs. WTA
Is perfect rationality
possible in a complex
world?
Are we Purely Self-interested?
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Game theory and experimental economics
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Ultimatum game
Dictatorship game
Public goods game
Or do we care about others?
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H. comunicus, concern for fairness and community
preferences
• H. naturalis, concern for sustainability and whole
system preferences
Evidence From Evolution
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Cooperation and energy abundance
Dictyostelium discoideum (amoeba)
 Myxococcus xanthus (self-organized, predatory,
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saprotrophic, single-species biofilm called a swarm)
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In humans, genetic and cultural evolution interact
Are People the Same Everywhere?
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Ultimatum game
across cultures
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Homo economicus, H. reciprocans, H.
Comunicus Behavioral economics
Neuroeconomics Prosocial behavior Easterlin
Paradox Choice under conflict Extrinsic and
intrinsic
incentives Dictator game Ultimatum game
Prisoner’s dilemma Public-good and
commonpool Altruistic punishment Conditional
cooperation
Why Does this Matter?
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Desirable ends
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Humans are satiable
We have a broad range of needs
Desired ends are in relationship to what others have
Allocative mechanisms
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Non-rival resources are best provided through
cooperation, and we are highly adapted to cooperate
Rival resources may be effectively allocated through
competition
Modeling humans as solely cooperative or solely
competitive is entirely inappropriate