Wednesday, November 7, 2018

The motivation is greed rather than increased social welfare

A great example of why the Founding Fathers were so focused on constraining the mob of direct democracy.

From The Mobbing Game by Alex Tabarrok. He summarizes this experimental research.
In short, the authors give experimental participants an opportunity to nominate a victim and redistribute towards themselves. Willingness to do this is common even in cases where the victims lose a lot and the bullies gain only a little. In some cases, the redistribution increases social welfare but these are also the cases where the bullies get a lot. Overall, it’s pretty clear that motivation is greed rather than increased social welfare but it would have been good to have an experiment that distinguished better the greed and social welfare cases. Importantly, distinguishing one of the players by making them poorer/richer/yellow also increased mobbing of that player.
Something to consider when next listening to a putatively altruistic proposal to help third-parties with the money and resources of second-parties. This research suggests that it can be assumed to be being done out of greed rather than a desire for increased social welfare. Until proven otherwise.

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