Survival of the Nicest by Stefan Klein

Author:Stefan Klein
Language: eng
Format: epub
Tags: Science
ISBN: 9781615191819
Publisher: The Experiment
Published: 2014-01-15T16:00:00+00:00

Free Rider Game. Four players get to decide how much they want to pay into a common pot. The sum of the contributions is tripled and divided evenly among all players. If a player like the one on the right contributes nothing, he cashes in nevertheless. Although his strategy is the most profitable, most people contribute—as long as others do, too.

The paradox of the Free Rider Game is that although the group as a whole earns more if everybody pays in, from the perspective of the individual it’s always more advantageous to hold onto one’s money and also collect an equal share of the common pot—to the detriment of the group. In our real-life example from public transportation, the subway company earns less money if a lot of people are jumping the turnstiles. It has to hire ticket checkers and raise prices to do so.

Happily—and despite the temptation—not even one-third of all people act with consistent selfishness. The majority (more than half of all subjects in the experiment), on the other hand, are opportunists. They would like to do something for the common good, but not at any price. At the start of the game, they behave generously as long as others are also being cooperative. But they start to get stingy if their fellow players pay in less than expected. That is precisely our norm for fairness: We’re quite ready to do something for others and for the community as a whole, but we’re unwilling to be exploited.

The remaining fifth of humanity consists of extremely altruistic men and women. They sacrifice themselves for the group even when they are surrounded by slackers. But most people simply mirror others’ behavior. If others do their share, we do ours. But if others act selfishly, we’re going to look out for our own advantage. We’re less a Homo economicus than a Homo reciprocans, humans driven by the wish to reciprocate. Most of us practice selflessness with a proviso; we’re provisional altruists.

Shape Up or Suffer the Consequences

As so often happens in real life, people in the Free Rider Game experience disappointment: Some egocentrics can’t wait to exploit the goodwill of the majority. And since their behavior violates the norm of fairness, cooperative participation in the game soon begins to fall apart. When one person repeatedly takes without having paid in, the others also refuse to contribute. Cooperation usually ceases after only a few rounds. Now all the players are only looking to their own advantage and hanging onto their money.

But the dynamic is profoundly altered if they have the chance to punish the free rider.9 Their revenge, however, costs money. For example, a player must pay a dollar to have a genuine or suspected cheater fined three dollars. Nevertheless, players have frequent recourse to this punishment. And it works: Now they all contribute their fair share. The contributions even increase from one round to the next. Suddenly, the norm of fairness has traction. It prevents the greedy from plundering the generous and so creates the preconditions for cooperation and sharing.

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