Article ID Journal Published Year Pages File Type
5092630 Journal of Comparative Economics 2010 16 Pages PDF
Abstract

This paper aims at a better understanding of the conditions under which unequal rank or power positions may get permanently established through asymmetric gift exchange when a gift brings pride to the donor and shame to the recipient. Such a framework matches numerous observations reported in the sociological and anthropological literature dealing with patronage relations in traditional setups. A central result derived from our model is that an asymmetric gift exchange equilibrium can occur only if the importance attached to social shame by a recipient is smaller than that attached to social esteem by a donor. Moreover, if this (necessary) condition is fulfilled, an asymmetric gift exchange will take place only if the recipient's productivity is neither too high nor too low. Finally, the possibility of a parasitic response of the gift recipient is more likely to be observed when the donee's sensitivity to social shame is low, or when his productivity is high.

Research highlights► Asymmetric exchange is not possible unless sensitivity of donee to shame is sufficiently low. ► Asymmetric exchange is not possible unless sensitivity of donor to esteem is sufficiently high. ► A gift recipient may behave parasitically when esteem considerations are at play. ► When a recipient is more sensitive to shame, he exerts more effort. ► If the productivity of the recipient is too high or too low, asymmetric exchange is impossible.

Related Topics
Social Sciences and Humanities Economics, Econometrics and Finance Economics and Econometrics
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