Motivated Beliefs, Independence and Cooperation

Wei Huang (), Yu Wang () and Xiaojian Zhao
Additional contact information
Wei Huang: CUHK Business School, Chinese University of Hong Kong
Yu Wang: China Center For Behavioral Economics and Finance, Southwestern University of Finance and Economics

No 2023-08, Monash Economics Working Papers from Monash University, Department of Economics

Abstract: Humans are social animals but sometimes stay alone. The paper theoretically investigates the connection between an intraperson game and an interperson interaction. Motivated beliefs supplied from memory management due to present bias in the individual investment problem give rise to a positive spillover on others through social interactions, suggesting that a high frequency of social interactions reduces an individual’s tendency to cooperate with others, exacerbating the free-riding problem. We also establish a positive relationship between overconfidence and prosocial behaviors. Evidence from cross-country observational data and cross-sectional data collected from an online experiment is largely consistent with our theoretical implications.

Keywords: motivated beliefs; self-confidence; present bias; cooperation; cultural difference (search for similar items in EconPapers)
JEL-codes: C91 D01 D91 O57 Z10 (search for similar items in EconPapers)
Date: 2023-05
New Economics Papers: this item is included in nep-cbe, nep-evo, nep-exp, nep-gth and nep-soc
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Journal Article: Motivated Beliefs, Independence and Cooperation (2024)
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