Behavioral Game Theory

In recent work with Amrish Patel we model giving to charity using a signalling game. With this approach a person is assumed to give to charity in order to signal some desirable trait about herself such as generosity or wealth. To many this approach seems quite a cynical one. It seemingly paints a picture of very strategic giving. Do people not give to charity because they want to make the world a better place?       What I want to try and convince you of here is that a signalling game approach actually paints a nice picture of giving - strategic, but not overly cynical.       Here is how a simple signalling game works: There are two types of people - generous and not-generous. The generous want to make the world a better place. The not-generous do not care. Society likes generous people. It likes them enough that it is willing to reward them in same way. This could be through esteem, status, or a greater willingness to help them when they need help, etc.       Notice the 'n

A ring that once belonged to Jane Austen came up for auction recently and was bought by US singer Kelly Clarkson for £150,000. The UK government has, however, subsequently put a ban on the singer taking the ring out of the country . The Culture Minister said 'I hope that a UK buyer comes forward so this simple but elegant ring can be saved for the nation.'       This is clearly the kind of policy that will split opinion. Some are going to think its important to save our heritage, and some will think it stupid to stop the sale of a ring worn by an author who died nearly 200 years ago. What does amuse me, however, is that just about every spokesperson I have heard criticising the policy appeals to economic theory to back up their case. Listening to them talk you could easily get the impression that hard-headed economic logic leads to only one conclusion - sell the ring. This is wrong!       The basic argument I heard more than once goes something like this. Kelly Clarkson pa