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Introduction Edmund S. Phelps The compartmentalizing of the study of human behavior and human knowledge into separate fields of inquiry, and the segregation of scholars into these compartments, seems to be a widely acknowledged fact of scientific life. However, the separations have never been airtight, and the leakages and seepages have often been as important as the walls limiting them. Men of great talent like Hume, Mill, Pareto and Ramsey commuted comfortably from economics to philosophy, or to politics or sociology, with their talents evidently conserved in the process. Just as successful nuclear physicists have felt licensed to share with us their views on the theory of knowledge, the distinguished economic theorist in the autumn of his career has often enjoyed visits to the interface of his subject with other fields. When Sir Dennis Robertson lectured at the bicentennial celebrations for Columbia University, it was therefore expectable that he would address a question of grandeur: "What Do Economists Economize?" His unexpected answer: They economize on love. In recent years there have been leakages from the economics compartment springing more from a curiosity to try the methods of economic analysis in other fields than from the restless talents of a versatile few. We have witnessed excursions into the theory of national defense, the axiomatics of neoutilitarianism , the economics of crime and punishment-and it has seemed to some that the leaks from economics threaten to inundate the compartment of political science. Because the areas of competing wants within a person and conflicting desires between persons go beyond the marketplace, it is natural that economists should check to see to what extent the techniques for analyzing the 1 2 • ALTRUISM, MORALITY, AND ECONOMIC THEORY market mechanism (its successes and failures) as a means of resolving such wants and desires carryover to these other areas. One (only one) mission of the present volume is an expedition of that kind, this time into the area of altruism, of behavior actuated by a sense of others, their desires and expectations. Several of the authors here have brought the concepts of economic theory, including game theory, and sometimes the theory of other disciplines as well, to bear on the analysis of the altruistic use of scarce resources. The range of altruistic behavior, or what we commonly interpret as such, is impressive. It is son.etimes exhibited (for good or ill) by sellers and buyers in" the marketplace. The presence of altruistic behavior, as economic activity in general, is even more pronounced away from commercial settings. More than one half of the American population depend for their security and material satisfactions not upon the sale of their services but rather upon their relationships to others. Altruism is expressed in varied forms. It may be individual, interpersonal, and unilateral, as within the family. It may also be cooperative and multilateral, being institutionalized in agencies of government, voluntary associations or private philanthropies. If a task of economists is to illuminate the allocation of resources, then the analysis of altruistic resource use is a bridge to be crossed. The wonderment over the phenomenon of altruism has led to several questions. Can altruistic behavior be fit into some version of the economist's beloved model of utility maximization subject to constraints? Or must that model be importantly modified and hooked up to some complementary body of analysis to yield a satisfactory product? More specifically: why, when and how do some persons behave in a way that is apparently altruistic-for what motives, under what circumstances, through what channels? In such an analysis, it would seem important to classify the various kinds of motives behind the collection of acts that are called altruistic. Possibly some acts called altruistic are interpretable as an investment, a quid for some implicit and conjectured quo. Another polar case in the typology is the altruistic act which is an unrequited transfer; the giving provides its own gratification. There should be room too in the taxonomy for acts of altruism in which there is "nothing personal," only a generalized regard for human rights, social codes, business "ethics," and so on. This last type of altruistic behavior is perhaps best thought of as the result of additional, moralistic constraints on utility maximization rather than the result of a compulsive or superstitious utility function (in a manner of speaking).1 1 Why? Presumably a moral constraint could and might cause the consumer to fail to obey the law of "compensated" consumer demand in some neighborhoods of the (amoral) choice set...


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