Aversive emotions are likely to be a key source of irrational human decision-making but still little is known about the underlying neural circuitry. Here, we show that aversive emotions distort trust decisions and cause significant changes in the associated neural circuitry. They reduce trust and suppress trust-specific activity in left temporoparietal junction (TPJ). In addition, aversive emotions reduce the functional connectivity between TPJ and emotion-related regions such as the amygdala. We also find that the posterior superior temporal sulcus (pSTS) plays a key role in mediating the impact of aversive emotions on brain-behavior relationships. Functional connectivity of right pSTS with left TPJ not only predicts mean trust taking in the absence of negative emotions, but aversive emotions also largely remove this association between TPJ-pSTS connectivity and behavioral trust. These findings may be useful for a better understanding of the neural circuitry of affective distortions and may thus help identify the neural bases of psychiatric diseases that are associated with emotion-related psychological and behavioral dysfunctions.
Women are known to have stronger prosocial preferences than men, but it remains an open question as to how these behavioural differences arise from differences in brain functioning. Here, we provide a neurobiological account for the hypothesized gender difference. In a pharmacological study and an independent neuroimaging study, we tested the hypothesis that the neural reward system encodes the value of sharing money with others more strongly in women than in men. In the pharmacological study, we reduced receptor type-specific actions of dopamine, a neurotransmitter related to reward processing, which resulted in more selfish decisions in women and more prosocial decisions in men. Converging findings from an independent neuroimaging study revealed gender-related activity in neural reward circuits during prosocial decisions. Thus, the neural reward system appears to be more sensitive to prosocial rewards in women than in men, providing a neurobiological account for why women often behave more prosocially than men.
We experimentally investigate behavior and beliefs in a sequential prisoner’s dilemma. Each subject had to choose an action as first-mover and a conditional action as second-mover. All subjects also had to state their beliefs about others’ second-mover choices. We find that subjects’ beliefs about others’ choices are fairly accurate on average. Using the elicited beliefs, we compare the explanatory power of a few current models of social and moral preferences. The data show clear differences in explanatory power between the preference models, both without and with control for the number of free parameters. The best-performing models explain about 80% of observed behavior. We use the estimated preference parameters to identify biases in subjects’ expectations. We find a consensus bias (whereby subjects believe others behave like themselves) and a certain optimism (whereby subjects overestimate probabilities for favorable outcomes), the former being about twice as strong as the second.
Institutions are an important means for fostering prosocial behaviors, but in many contexts their scope is limited and they govern only a subset of all socially desirable acts. We study experimentally how the presence and nature of an institution that enforces prosocial behavior in one domain affects behavior in a similar but unregulated domain. Groups play two identical public good games, with cooperation institutionally enforced in one game. The presence of an institution in one game generally enhances cooperation in the other game, thus documenting a positive spillover effect. These indirect spillover effects are economically substantial, amounting up to 30 to 40 percent of the direct effect of institutions. In addition, we find evidence for sequential spillover effects, meaning that behavior is affected by the institution even after it is removed. We also observe that institutions enhance prosocial preferences and beliefs about others’ prosocial behavior, even toward strangers, suggesting that both factors are drivers of the observed spillover effects. We further explore other aspects influencing spillover effects, including characteristics of an institution, such as whether it is exogenously imposed or endogenously determined.
We provide a direct test of the impact of altruism on remittances. From a sample of Indian migrant workers in Qatar, we elicit the propensity to share with others from their responses in a dictator game and use it as a proxy for altruism. For the entire sample, we find that altruism does not seem to matter. However, we document a strong positive relationship between altruism and remittances for a subset of migrants with a loan obligation, whereas indirect tests of altruism, typically used in the literature, would fail to establish this relationship. We explain the role of loan obligations with a standard remittance model extended with reference-dependent preferences.
Efficiently growing a group often requires integrating individuals from lower performing entities. We explore the effectiveness of policies intended to facilitate such integration, using an experiment that models production as a coordination game. We create an efficient group and an inefficient one. We then allow individuals to move into the efficient group under different mechanisms. We investigate the use of an entry quota, an entry quiz and combinations of the two in order to try to understand if and why the institutions are effective. We find that both restrictions work to maintain efficient coordination but they are effective for different reasons.
In Europe, more than 250,0 0 0 university students spend one or two semesters abroad every year. This study explores whether a short time abroad contributes to the acquisition of foreign language proficiency. We use a newly available dataset about almost the totality of Italian graduates and two alternative in- struments to address the endogeneity of studying abroad. Both instruments display similar results. The effect of studying abroad on foreign language proficiency is remarkable, although extremely heteroge- neous across languages. Languages more rewarded by the labor market are those that are harder to learn in a short time abroad.
The delivery of basic health products and services remains abysmal in many parts of the world where child mortality is high. This paper shows the results from a largescale randomized evaluation of a novel “social entrepreneurship” approach to health care delivery. In randomly selected villages a sales agent was locally recruited and incentivized to conduct home visits, educate households on essential health behaviors, provide medical advice and referrals, and sell preventive and curative health products. Results after three years show substantial health impact: under-5 child mortality was reduced by 27% at an estimated cost of $71 per life-year saved.
