In a Study to Examine Altruistic Behavior, an Economics Professor

question 4

Multiple Choice

In a study to examine altruistic behavior, an economics professor recruits college students to participate in a game. The game consists of teams of two, where one person is the proposer and the other the responder. The proposer receives a sum of money and must decide how to split the money with the responder. If the responder likes how the money was split, each person receives the determined amount. If the responder rejects the split, neither player receives any money. This study is an example of a:

• A) Pigouvian conjecture.
• B) lab experiment.
• C) natural experiment.
• D) path-dependent experiment.

---

Definitions:

Bureaucracy

A system of administration characterized by a hierarchical structure, specialization of functions, and a set of rules and procedures.

Business Entrepreneur

An individual who identifies a business opportunity and takes financial risk to establish and manage a new enterprise.

The State

Consists of the institutions responsible for formulating and carrying out a country’s laws and public policies.

Coercive Socio-Political System

A form of governance or societal structure where power is maintained and exercised through force, intimidation, or repression.