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Department of Economics pres.

Economics Seminar: Linking Social and Personal Preferences

Shachar Kariv, University of California, Berkeley

Economics Economics

We provide a positive account of preferences for both personal and social consumption in rich choice environments. Such preferences are important in many contexts, including taxation, charitable giving, development, and globalization. In all of these settings, understanding behavior requires understanding the personal and social preferences that lie behind it. A theoretical and empirical analysis of these preferences therefore has implications in a host of areas. The primary methodological contributions of the work are the establishment of theoretical links between preferences in various environments and an experimental technique that allows for the collection of richer data about preferences than has heretofore been possible. Beginning with the theoretical and experimental findings, we can address important questions concerning personal and social preferences, including: Is observed behavior consistent with the utility maximization hypothesis on which economic theory relies? Can underlying preferences be recovered from observed choices? What is the relationship between personal preferences and social preferences?

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