Law and Literature: Theory and Evidence on Empathy and Guile
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Daniel L. Chen
Abstract
Legal theorists have suggested that literature stimulates empathy and affects moral judgment and decision-making. I present a model to formalize the potential effects of empathy on third parties. Empathy is modeled as having two components–sympathy (the decision-maker’s reference point about what the third party deserves) and emotional theory of mind (anticipating the emotions of another in reaction to certain actions). I study the causal effect with a data entry experiment. Workers enter text whose content is randomized to relate to empathy, guile, or a control. Workers then take the Reading the Mind in the Eyes Test (RMET) and participate in a simple economic game. On average, workers exposed to empathy become less deceptive towards third parties. The result is stronger when workers are nearly indifferent. These results are robust to a variety of controls and model specifications.
Acknowledgements
I thank Aroha Bahuguna and Yutong Li for research assistance. Work on this project was conducted while I received financial support from the European Research Council (Grant No. 614708), Swiss National Science Foundation (Grant Nos. 100018–152678 and 106014–150820), Agence Nationale de la Recherche, John M. Olin Foundation, Ewing Marion Kauffman Foundation, and Templeton Foundation (Grant No. 22420).
Appendix - Payoffs Used in the Experiment
Treatment 1
This is a short experiment in decision making. In this experiment, you will be matched with another worker. Neither of you will ever know the identity of the other. The money that you earn will be paid to you next week, privately and in cash.
Two possible monetary payments are available to you and your counterpart in the experiment. The two payment options are:
option A: 5 cents to you and 6 cents to the other worker
Option B: 6 cents to you and 5 cents to the other worker
| Payoff to | |||
|---|---|---|---|
| Treatment | Option | Player 1 | Player 2 |
| 1 | A | 5 | 6 |
| B | 6 | 5 | |
| 2 | A | 5 | 15 |
| B | 6 | 5 | |
| 3 | A | 5 | 15 |
| B | 15 | 5 |
The choice rests with the other worker who will have to choose either Option A or Option B. The only information your counterpart will have is information sent by you in a message. That is, he or she will not know the monetary payments associated with each choice.
We now ask you to choose one of the following two possible messages, which you will send to your counterpart:
message 1: “Option A will earn you more money than Option B.”
Message 2: “Option B will earn you more money than Option A.”
We will show the other worker your message and ask him or her to choose either A or B. To repeat, your counterpart’s choice will determine the payments in the experiment. However, your counterpart will never know what sums were actually offered in the option not chosen (that is, he or she will never know whether your message was true or not). Moreover, he or she will never know the sums to be paid to you according to the different options.
We will pay the two of you according to the choice made by your counterpart.
I choose to send (please select one option):
Message 1 Message 2
Treatment 2
This is a short experiment in decision making. In this experiment, you will be matched with another worker. Neither of you will ever know the identity of the other. The money that you earn will be paid to you next week, privately and in cash.
Two possible monetary payments are available to you and your counterpart in the experiment. The two payment options are:
option A: 5 cents to you and 15 cents to the other worker
Option B: 6 cents to you and 5 cents to the other worker
The choice rests with the other worker who will have to choose either Option A or Option B. The only information your counterpart will have is information sent by you in a message. That is, he or she will not know the monetary payments associated with each choice.
We now ask you to choose one of the following two possible messages, which you will send to your counterpart:
message 1: “Option A will earn you more money than Option B.”
Message 2: “Option B will earn you more money than Option A.”
We will show the other worker your message and ask him or her to choose either A or B. To repeat, your counterpart’s choice will determine the payments in the experiment. However, your counterpart will never know what sums were actually offered in the option not chosen (that is, he or she will never know whether your message was true or not). Moreover, he or she will never know the sums to be paid to you according to the different options.
We will pay the two of you according to the choice made by your counterpart.
I choose to send (please select one option):
Message 1 Message 2
Treatment 3
This is a short experiment in decision making. In this experiment, you will be matched with another worker. Neither of you will ever know the identity of the other. The money that you earn will be paid to you next week, privately and in cash.
Two possible monetary payments are available to you and your counterpart in the experiment. The two payment options are:
option A: 5 cents to you and 15 cents to the other worker
Option B: 15 cents to you and 5 cents to the other worker
The choice rests with the other worker who will have to choose either Option A or Option B. The only information your counterpart will have is information sent by you in a message. That is, he or she will not know the monetary payments associated with each choice.
We now ask you to choose one of the following two possible messages, which you will send to your counterpart:
Message 1: “Option A will earn you more money than Option B.”
Message 2: “Option B will earn you more money than Option A.”
We will show the other worker your message and ask him or her to choose either A or B. To repeat, your counterpart’s choice will determine the payments in the experiment. However, your counterpart will never know what sums were actually offered in the option not chosen (that is, he or she will never know whether your message was true or not). Moreover, he or she will never know the sums to be paid to you according to the different options.
We will pay the two of you according to the choice made by your counterpart.
I choose to send (please select one option):
Message 1 Message 2
Treatment 4
Mr. Johnson is about to close a deal and sell his car for $1,200. The engine’s oil pump does not work well, and Mr. Johnson knows that if the buyer learns about this, he will have to reduce the price by $250 (the cost of fixing the pump). If Mr. Johnson doesn’t tell the buyer, the engine will overheat on the first hot day, resulting in damages of $250 for the buyer. Being winter, the only way the buyer can learn about this now is if Mr. Johnson were to tell him. Otherwise, the buyer will learn about it only on the next hot day. Mr. Johnson chose not to tell the buyer about the problems with the oil pump. In your opinion, Mr. Johnson’s behavior is:
Completely Fair
Fair
Unfair
Very Unfair
What would your answer be if the cost of fixing the damage for the buyer incase Mr. Johnson does not tell him is $1,000 instead of $250? Mr. Johnson’s behavior is:
Completely Fair
Fair
Unfair
Very Unfair
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Artikel in diesem Heft
- Litigation and the Product Rule: A Rent Seeking Approach
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- Takeover Protection and Firm Value
- Rethinking Apology in Tort Litigation Deficiencies in Comprehensiveness Undermine Remedial Effectiveness
- Law and Literature: Theory and Evidence on Empathy and Guile
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Artikel in diesem Heft
- Litigation and the Product Rule: A Rent Seeking Approach
- Emissions Trading Hybrids: The Case of the EU ETS
- Takeover Protection and Firm Value
- Rethinking Apology in Tort Litigation Deficiencies in Comprehensiveness Undermine Remedial Effectiveness
- Law and Literature: Theory and Evidence on Empathy and Guile
- Efficient and Inefficient Sales of Corporate Control: The Case of Going Private
- Punishment Severity and Crime: The Case of Arkansas
- Expanding Shareholders’ Power: An Analysis of Reform Proposals in Malaysia
