Posts Tagged ‘gifts’

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Anyone say Veblen?

Posted: 1 December 2012 in Uncategorized
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Gifts for the 1 percent in a still-predatory economy. . .

Altruism has long been a problem for neoclassical economics. In the case of blood donations, that problem continues.

Neoclassical economists, given their focus on self-interest and utility-maximization, have never been able to make sense of altruism  (nor, for that matter, of related cases of other-directed nonmarket behavior such as gift-giving). Their view is that private markets are the best way of allocating goods and services, including bodies and body parts.

In a new study (summary and article), Joan Costa-i-Font, Mireia Jofre-Bonet, and Steven T. Yen demonstrate that paying for blood actually crowds out voluntary donations of blood since it undermines the “warm-glow” associated with altruistic blood giving. The idea is that individuals who give blood have an identity or image of themselves as donors and that monetary rewards undermine that self-conception.*

It is precisely such a nonmarket, altruistic identity that continues to elude the models that neoclassical economists use to understand individual behavior and to celebrate free markets.

* Other interesting aspects of their study include the following: non-monetary incentives do not undermine voluntary donations (although they never explain what non-monetary rewards are or might be); the negative relationship between monetary rewards and blood donation is significant across all countries; and there are strong gender differences, in that men are both more likely than women to be donors and to favor monetary rewards.