10. What does behavioral economics have to say about each of the following statements?
a. âNobody is truly charitable-they just give money to show off.â
b. âAmerica has a ruthless capitalist system. Considerations of fairness are totally ignored.â
c. âSelfish people always get ahead. Itâs like nobody even notices!â
11. Do people playing the dictator game show only self-interested behavior? How much divergence is there in the splits given by dictators to the other player?
Answer: Most people playing the dictator game show a concern for others. In particular, most dictators give at least some of the money to the other player even though the game is fully anonymous and the other player has no way of retaliating. There is a wide range of generosity seen among dictators. About 5 percent give everything to the other player. On the other hand, about one-third of all dictators keep everything for themselves while 17 percent of dictators split the money perfectly evenly between themselves and the other player.