Presenter Information

Shama Ramos, Colby CollegeFollow

Location

Parker-Reed, SSWAC

Start Date

30-4-2015 9:00 AM

End Date

30-4-2015 10:55 AM

Project Type

Poster

Description

In neoclassical economics, we assume individuals generally based their decisions on their own welfare maximizing their utility. Due to this assumption, we created a tax system in order to provide public goods so that no one will act as a free-rider. Nonetheless, this system only provides general optimal utility instead of optimal utility for each individual. Because of the set assumption that humans only seek self-interest, economists overlooked other significant factors affecting peoples decision-making processes. In this research, I applied an agent-based model in order to take in consideration other factors affecting human decision-making and propose a new system in funding public goods. I separate the factors affecting decision-making to two categories: internal behavior and external influences. The internal behaviors studied in this paper are cooperative behavior, indifferent behavior, and free-rider. The external influences are the social loafing effect, bystander effect, and conformity and imitation. Results of this study show that opportunistic behavior is the overall tended behavior. However, given the proper external influence, opportunistic behavior is the least likely tended conduct. Moreover, given the appropriate set of reward-punish system, cooperative behavior will be the overall inclined action. Note that this model will only work in a small setting like a village, town, or a small city.

Sponsoring Department

Colby College. Economics Dept.

CLAS Field of Study

Social Sciences

Event Website

http://www.colby.edu/clas

ID

1655

Included in

Economics Commons

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Apr 30th, 9:00 AM Apr 30th, 10:55 AM

Rethinking How to Efficiently Fund Public Goods: An Agent-Based Modelling of a Group Funding System Accommodating Different Human Behaviors and Influences Affecting Decision-Making

Parker-Reed, SSWAC

In neoclassical economics, we assume individuals generally based their decisions on their own welfare maximizing their utility. Due to this assumption, we created a tax system in order to provide public goods so that no one will act as a free-rider. Nonetheless, this system only provides general optimal utility instead of optimal utility for each individual. Because of the set assumption that humans only seek self-interest, economists overlooked other significant factors affecting peoples decision-making processes. In this research, I applied an agent-based model in order to take in consideration other factors affecting human decision-making and propose a new system in funding public goods. I separate the factors affecting decision-making to two categories: internal behavior and external influences. The internal behaviors studied in this paper are cooperative behavior, indifferent behavior, and free-rider. The external influences are the social loafing effect, bystander effect, and conformity and imitation. Results of this study show that opportunistic behavior is the overall tended behavior. However, given the proper external influence, opportunistic behavior is the least likely tended conduct. Moreover, given the appropriate set of reward-punish system, cooperative behavior will be the overall inclined action. Note that this model will only work in a small setting like a village, town, or a small city.

http://digitalcommons.colby.edu/clas/2015/program/119