More than Trust: Oxytocin Increases Generosity

It was known since a couple of years that oxytocin (OT) increases trust (Kosfeld, et al., 2005): in the Trust game, players transfered more money once they inhale OT. Now recent research also suggest that it increases generosity. In a paper presented at the ESA (Economic Science Association, an empirically-oriented economics society) meeting, Stanton, Ahmadi, and Zak, (from the Center for Neuroeconomics studies) showed that Ultimatum players in the OT group offered more money (21% more) than in the placebo group--$4.86 (OT) vs. $4.03 (placebo).
They defined generosity as "an offer that exceeds the average of the MinAccept" (p.9), i.e., the minimum acceptable offer by the "responder" in the Ultimatum. In this case, offers over $2.97 were categorized as generous. Again, OT subjects displayed more generosity: the OT group offered $1.86 (80% more) over the minimum acceptable offer, while placebo subjects offered $1.03.

Interestingly, OT subjects did not turn into pure altruist: they make offers (mean $3.77) in the Dictator game similar to placebo subjects (mean $3.58, no significant difference). Thus the motive is neither direct nor indirect reciprocity (Ultimatum were blinded one-shot so there is no tit-for-tat or reputation involved here). It is not pure altruism, according to Stanton et al., (or "strong reciprocity"--see this post on the distinction between types of reciprocity) because the threat of the MinAccept compels players to make fair offers. They conclude that generosity in enhanced because OT affects empathy. Subjects simulate the perspective of the other player in the Ultimatum, but not in the Dictator. Hence, generosity "runs" on empathy: in empathizing context (Ultimatum) subjects are more generous, but in non-empathizing context they don't--in the dictator, it is not necessary to know the opponent's strategy in order to compute the optimal move, since her actions has no impact on the proposer's behavior. It would be interesting to see if there is a different OT effect in basic vs. reenactive empathy (sensorimotor vs. deliberative empathy; see this post).

Interested readers should also read Neural Substrates of Decision-Making in Economic Games, by one of the author of the study (Stanton): in her PhD Thesis, she desribes many neurpeconomic experiences.

[Anecdote: I once asked people of the ESA why they call their society like that: all presented papers were experimental, so I thought that the name should reflect the empirical nature of the conference. They replied judiscioulsy : "Because we think that it's how economics should be done"...]

References

• Kosfeld, M., Heinrichs, M., Zak, P. J., Fischbacher, U., & Fehr, E. (2005). Oxytocin increases trust in humans. Nature, 435(7042), 673-676.
• Stanton, A. A. (2007): Neural Substrates of Decision-Making in Economic Games. Published in: Journal of Dissertation Issue 1.Volume 1 (2007): pp. 1-63.
• Stanton, A. A., Ahmadi, S., & Zak, P. J. (2007). Oxytocin Increases Generosity. Paper presented at the Economic Science Association 2007 World Meeting.