SAMARITAN VS. ROTTEN KID: ANOTHER LOOK

We set up a two-stage game with sequential moves by one altruistic agent andn selfish agents. The rotten kid theorem states that the altruist can only reach her firstbest when the selfish agents move before the altruist. The Samaritan’s dilemma, on theother hand, states that the altruist can only reach her first best when she moves beforethe selfish agents. We find that in general, the altruist can reach her first best when shemoves first, if and only if a selfish agent’s action marginally only affects his own payoff.The altruist can reach her first best when she moves last if and only if a selfish agentcannot manipulate the price of his payoff...