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Empathy as Game Theory

Tue, September 28, 2:00 to 3:30pm PDT (2:00 to 3:30pm PDT), TBA

Abstract

Most game-theoretic analysis assumes players make a correct conjecture about how others behave. But where do these beliefs come from? One possibility is that individuals imagine how they would behave in the others' role. But social scientists have also shown that imagining oneself in the other's shoes is a form of empathy, which engenders other-regarding behavior. This paper illuminates the mechanisms through which empathy affects individual behavior, with implications for cooperation. Theoretically, it highlights two possible channels: eliciting empathy can improve the accuracy of beliefs about what the other will do and/or increase the weight placed on the other's payoff. Each channel has implications for cooperation. We develop a simple model to illustrate these potential pathways, and test it empirically with a lab experiment.

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