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Understanding human behavior to change the economy

Interview with Vittorio Pelligra, teacher at the EoC Summer School Madrid 2013

by Ana María Moreno Marín 

vittoriopelligraVittorio Pelligra, specialist in game theory and cooperation, will help us to understand human behavior, which changes depending on personal and economic variables: how people react to external circumstances and how interact in situations affecting their innate individuality. He will guide us in our search for reciprocity and the common good through the new culture of the Economy of Communion. He is one of the lecturers of this Summer School and he is excited about it.  So, are you ready for the start ? Vittorio is.

1) You have studied the cooperation. What have you found out? Do we cooperate or are we selfish?

Actually, I study not only cooperation but how real people behave in any economic situations. We use experiments to carefully control the variables that affect their choices and how incentives shape their preferences. According to the standard economic theory, people are self-interested, thus when they cooperate they do so in their own interest. However, many experiments have shown that people tend to cooperate also for many other reasons: because they care for others’ well being or because they have an innate propensity towards justice, equality and reciprocity. It means that real people are more complex than assumed by standard economic theory: sometimes they cooperate, sometimes they don’t. What we need to understand is which factors and external and internal trends may favor cooperation.

2) How does the game theory help us to understand the issues of the economy?

Game theory is a sort of language that can be used to describe and understand the logic of the interactions between agents, individuals, firms, nations, even members of non-human species. The economic system can be thought as an incredibly complex network of interactions where the consequences of our decisions depend on the combination of the decisions of many other people. Game theory helps us in the analysis of these interrelations. Things like the competition between large firms to set prices or launch a new product can be analyzed using the language of game theory. But it can be useful also in another more fundamental way. When we deal with other people, both to cooperate and compete, we need to figure out what their intentions are and at the same time taking their decisions into account in our own decisions, and so on. This kind of strategic reasoning can be sometimes quite complicated, that is why we need the game theory to shed light on it.

3) What social changes could lead to a more cooperative behavior among individuals?

Suppose that the idea that individuals are motivated merely by their self-interest represents a sort of self-fulfilling prophecy. This means that when we say that people are selfish, we induce them to behave accordingly. This is due, firstly to the fact that we have created a culture that promotes values such as individualism and greed. Think of the enormous but unjust role that economic matters have on our daily lives. Secondly, due to an anthropology based on the homo-oeconomicus model, that foster in people less cooperative attitudes and propels egoistic habits. This shows how important, in order to build a more plural world, the multi-dimensional model of economic action is, one that is able to account for altruism, fairness, reciprocity and even gratuitousness.

4) Does the EoC contribute to the understanding of the economic cooperative behavior?

The EoC project and the member organizations represent a fantastic full scale laboratory, where all these tendencies towards cooperation, but also its pitfalls and gray areas, can be observed in vivo, described and understood. At the same time the EoC project and firms may greatly benefit from implementing standards, rules, incentive systems that are able to enhance cooperation and cohesion.

5) Do you believe it's possible another economy, more inclusive, sustainable and humane? What are the key elements to achieve this goal?

It’s not only possible, but, as the global economic crisis has shown, it is becoming more and more necessary. In the changing process towards a more humane and sustainable economy, the EoC project plays a crucial role because, despite its small size, it illustrates how economic organizations may not only willingly contribute to the common good, but also stay on the market and make their workers’ lives more fulfilled and, in the end, happier.

6) What do you expect from this Summer School?

I have great expectations: Many motivated students, an international environment, challenging discussions, friendship and the possibility to share and put forward a vision for a better and more just world.

 

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