Chapter Outline

Present-aim rationality is too broad and self-interest rationality cannot explain behaviour where habit, passion, and appetite are involved.
The pursuit of rational choice self-interest does not always bring the greatest rewards.
1. Where interdependence and trust are present, the rewards of altruism and cooperation may be greater than the rewards of narrow self-interested behaviour.
2. The parable of the hawks and doves shows how both altruistic and narrow self-interested preferences will both exist in a society.
The prisoner's dilemma shows that the commitment problems must be solved for doves or cooperators to be successful.
A model of cooperators and defectors illustrates the tenuous balance in society between the two groups.
1. Defectors will dominate if social interaction is random.
2. Cooperators will dominate if free detection of each group exists.
3. If detection is costly, society will be made up of both groups.
4. Because mimicry of cooperative behaviour is always a likely practice, detection costs will be positive and both preferences for behaviour will exist despite the common rational choice notion that tastes for behaviour are fixed.
Emotions sometimes lead us to behaviour that seems irrational.
1. People sue others when the costs exceed any possible gain because of the emotion of anger.
2. Many people vote in elections when the costs exceed the benefits except for the pull of patriotism.
3. People will give up absolute income to preserve their relative income standing.
In short, some identifiable tastes based on emotions of all kinds can lead to advantages that opportunists miss, but those who benefit from the exercise of altruism and emotion must inevitably hold their preferences sincerely.

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