| The simple and traditional approach in economics is to model individuals as making decisions that maximize their own (expected) material payoff. A large part of research in behavioral and experimental economics is concerned with studying additional motivations that may drive human behavior, especially in situations where there is tension between selfish and prosocial behavior. The first two chapters of this dissertation are a contribution to this literature. In the first chapter I study visibility. It is known that visibility (as opposed to anonymity), promotes prosocial behavior: we are more likely to cooperate, to give, and to vote if we know that our choices are not anonymous. I hypothesize that the power of visibility to induce prosocial behavior depends on the size of the group that is being observed. I test this hypothesis experimentally and find evidence in favor of the hypothesis: individuals that behave selfishly under anonymity are significantly more likely to behave prosocially when their choices and identities are visible in small reference groups instead of large reference groups. Strikingly, individuals in large reference groups that were given the opportunity to adjust their choices after observing the behavior of others were more likely to behave selfishly than under anonymity. However, this was not the case in small reference groups. I could partially attribute this difference between group sizes to the inability of shame to induce prosocial behavior in large groups. Motivated by this results, I propose a theory where the psychological cost of being seen transgressing a norm (behaving selfishly) is dependent on the number of norm-transgressors and norm-followers in a group. I find additional conditions for the theory to yield results consistent with the hypothesis: there must be a sufficiently high proportion of baseline transgressors ("bad apples") in the population and a transgressor should exert more psychological influence on a decision maker than a norm-follower.;In the second chapter I propose a theoretical framework, based on psychological game theory, that is able to account for recent findings pointing to the fact that individuals are more likely to behave selfishly if their responsibility of taking selfish actions is obscured. In this framework, decision makers do have a notion of what constitutes acceptable behavior in a given situation (injunctive norm) according to some values (e.g fairness, reciprocity), but they are not internally motivated to follow those norms as would be the case if they had traditional "social preferences". Instead, individuals are averse to be seen transgressing a norm.;The final chapter studies how individuals process news regarding the likelihood of an event that is desirable, but not ego-relevant. I hypothesize that individuals biasedly favor good news over bad news and present an experimental design and data to test this hypothesis. As opposed to previous research that has found biases in information processing regarding ego-relevant and desirable events, I find no evidence of a systematic bias. |
