Utility interdependence when personality types interact

Abstract

Provides an alternative to the usual approach of economists of simply assuming human nature and human economic behaviour to be of a particular type. Economics generally provides little explanation for the formation of preferences. Psychological motivation variables for giving and receiving will be analysed which define an individual′s personality type in terms of his altruistic or non‐altruistic orientation. Presents a description of these psychological variables and the manner in which they are measured. An individual′s giving‐receiving motivational patterns are then incorporated into his utility function, and a theoretical analysis is made of the optimal level of transfers when various personality types interact.