Altruistic Economics: Encyclopedia II - Altruistic Economics - Concept

Altruistic Economics - Concept

By allowing mathematical expression of altruism, Altuistic Economics generalises the standard neoclassical model, which is founded on the selfish homo economicus. Like the neoclassical model, Altruistic Economics assumes people are maximisers, but it breaks the assumption that their welfare is independent of others. It also abandons the assumption that everyone is identical. Individual human relationships are modelled, so that everyone can specify how they feel about anyone else. Sympathy for someone is defined as a willingness to forego benefit so that they may benefit instead. The altruistic model allows people to explicitly declare sympathy for their friends so that other users can be aware of their feelings. Another key feature of altruistic economics is that transactions can be independently evaluated by the parties involved. By relaxing the restriction that human interaction must be modelled in a zero sum fashion, it effectively skips the invidious and inefficient process of price negotiation.

Altruistic economics is under active development, but no working system has yet been produced, due to the complexity of implementing a Friend-to-friend computer infrastructure of personal servers to do the calculations. It therefore remains to be seen whether the aggregate effect of everyone maximising for themself and their friends will produce an increase in group wellbeing, similar to the aims of the Bhutanese notion of Gross National Happiness. If it does, then Altruistic Economics may form a good basis for an Internet gift economy.

Adapted from the Wikipedia article "Concept", under the G.N U Free Docmentation License. Please also see http://en.wikipedia.org/wiki