What preferences will prevail in a society of rational individuals when preference evolution is driven by their success in terms of resulting payoffs? We show that when individuals’ preferences are their private information, a convex combinations of selfishness and morality stand out as...

We analyze the effects of family ties on the incentives for production of effort, where family ties are defined as a mixture of true and coerced altruism between family members. We model families as pairs of siblings. Each sibling exerts effort in order to obtain output under uncertainty. A...

Recognizing that individualism, or weak family ties, may be favorable to economic development, we ask how family ties interact with climate to determine individual behavior and whether there is reason to believe that the strength of family ties evolves differently in different climates. For this...

Accordingto Hamilton’s(1964a, b) rule,a cost lyaction will be undertaken if its fitness cost to the actor falls short of the discounted benefit to the recipient,where the discount factor is Wright’s index of relatedness between the two. We propose a generalization of this rule,and show that...

We analyze how family ties affect incentives, with focus on the strategic interaction between two mutually altruistic siblings. The siblings exert effort to produce output under uncertainty, and they may transfer output to each other. With equally altruistic siblings, their equilibrium effort is...

We study the implications of honesty when it requires pre-commitment. Within a two-period hidden information problem, an agent learns his match with the assigned task in period 2 and, if honest, reveals it to the principal if he has committed to it. The principal may offer a menu of contracts to...

We explore the potential for discriminating between honest and dishonest agents, when a principal faces an agent with private information about the circumstances of the exchange (good or bad). When honest agents reveal circumstances truthfully independently of the contract offered, the principal...

A principal requires a manager for production. He can use an internal manager, or contracts with an external manger. In each case, the manager obtains experience benefits from production. When the principal uses an internal manager, both parties share cost information. When the principal...

What preferences will prevail in a society of rational individuals when preference evolution is driven by their success in terms of resulting payoffs? We show that when individuals’ preferences are their private information, a convex combinations of selfishness and morality stand out as...