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“A minority of people behave like homo oeconomicus in real life”

How do market integration and climate change affect social cohesion? PICAIS-fellow Dr Gianluca Grimalda explores this question by analysing data collected during experiments in Papua New Guinea – with sometimes surprising results.

Guest researcher Dr Gianluca Grimalda talking to his hosts at the University of Passau, Dr Katharina Werner and Professor Johann Graf Lambsdorff, with the Passau railway station in the background. "Slow travelling", travelling on the surface is the preferred option of Dr Grimalda, who has become known as the researcher who refuses to fly.

Dr Gianluca Grimalda is a social scientist who studies the social impact of climate change through fieldwork in the island of Bougainville off the coast of Papua New Guinea. He became known in the media as the researcher who refuses to fly, which ultimately cost him his job as a senior researcher at the Kiel Institute for the World Economy. His story provoked national and international media coverage. This was also when Dr Katharina Werner and Professor Graf Lambsdorff of the University of Passau decided to invite him as a research fellow at the PICAIS - Passau International Centre for Advanced Interdisciplinary Studies. Dr Werner and Dr Grimalda share a research interest in experimental economics and had met at various international conferences before. During his six-months research stay in Passau, Dr Grimalda, with the help of Dr Werner, will analyse the data that he collected during his field studies on the island of Bougainville. Through his experiments there, he is trying to shed light on the question: Does market integration and exposure to climate change make us more selfish or more cooperative? A talk about human nature and the suprising results of the experiments. 

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Does market integration make us more selfish?

If you asked that question people on the street, 99 per cent would say that markets make us more selfish. But in anthropology, many scholars say the opposite. They argue that markets teach us to trust strangers. Particularly in these tribal societies that I study in Papua New Guinea, where many relationships are at the level of the family or the village, markets train people to think that they can consider the network of people that they can trust to be much larger than just the family or the clan or the people in their village. 

How do you measure market integration in your fieldwork?

For example, we ask people about their diet. How many calories come from food you buy from the market? And how many come from food you grow in your garden? In fact, my team and I have interviewed 1800 people about what they ate yesterday and last week. One of my tasks here in Passau will be to analyse this and reconstruct the market integration from the calories. Another indicator is how close people live to the market, how long it takes to get there and how much money it costs. We are also looking at how much of their income derives from selling their products to international markets. For example, in Bougainville, where I conducted my research, people sell coconut oil to international markets. During our research in 2019, we were able to show that it was mainly the link to the international market that mattered in terms of social cohesion. In some villages, we started to see inequality and tolerance of inequality. And we wanted to look at that more closely.

How did you do that?

I use similar methods to Katharina Werner. We both do experimental economics. That means that we involve people in games. In the villages in Bougainville, we played an ability game between two people at a time. They had to throw rings into a bucket. By doing so, they were assigned 24 kina -  local currency in Papua New Guinea - in total. The "winner" would get 20 kina and the "loser" 4 kina. And then we asked them, how they would divide the 24 kina between the two of them. That was our measure of prosociality, the willingness to help each other. They didn’t know who they were dealing with. They knew that it could either be a person from the village or from another village far away. In some villages, many people chose to share fifty-fifty. In some other villages, we found that the person who threw more things into the bucket wanted a bigger share of the 24 kina. And in other villages, in two villages close to the market, we found very selfish people. But in our new data, it seems that the picture is not so clear. 

What has changed? Can you give us an example?

In some villages close to the market town we found very cooperative people, very willing to share. You ask for an example – I was particularly intrigued by one village that was very close, just a four-minute drive on a very good road. So I expected, based on my previous studies, that people would be relatively selfish. Instead, they were super cooperative, they were the people most likely to share equally in the second wave of research. So I wanted to know more about them. They told me that they used to have a cooperative enterprise that involved many people in the community to sell fish. People would go fishing, sell the fish in the market and all the revenues would be shared equally in the community. So in this respect it makes sense that people were so cooperative in our game, it was because they also were cooperative in real life.

Climate change is probably the most difficult cooperation problem because it involves 8 billion people with very different cultural backgrounds. At the international level, with many different cultures, we see very little cooperation.

Dr Gianluca Grimalda

What about the concept of homo oeconomicus? How does that fit into this theory?

The methodology of experimental economics has really been instrumental in destroying that concept and finding that, fortunately, only a minority of people behave like a homo oeconomicus in real life. In our sharing games, we usually find that about a third of participants follow that behaviour. In strategic games, in so-called Trust Games,  beliefs on others’ behaviour also matter. But the assumptions of the homo oeconomicus concept coupled with the belief that other people are also homo oeconomicus only predict 5 percent of the behaviour. Most people have social norms and norms of fairness. Of course, you could argue that it’s easier to be nice to other people when there is little money. But even when there is a lot of money, experiments show that people are not completely selfish. In research, we like to talk about homo reciprocans. If I expect you to be nice to me, I’ll be nice to you. This seems closer to our psychology than the psychology of homo oeconomicus. And this is also what I learnt from my travels: I see a lot of propensity to help others, especially to help me. In my travels, I have met at least 50 people who have given their time and sometimes even their money without asking for anything in return, just because they wanted to help. But in many situations it’s true that we don’t cooperate very well. Climate change is probably the most difficult cooperation problem because it involves 8 billion people with very different cultural backgrounds. At the international level, with many different cultures, we see very little cooperation.

In his office at the University of Passau, Dr Gianluca Grimalda is surrounded by souvenirs he brought with him from his travels to countries in the Global South.

Why does cooperation work at the local level, but not at the global level?

At the local level you can use what we call indirect reciprocity. If I do something good for you and someone else watches me do it, they will do something good for me. In a way, there is already a social norm that identifies what is good and what is not. This can spread to larger groups. That’s why it‘s relatively easy to work together in local groups because the relationships are personal. I can see rather well who’s doing good and who’s not. But in international relationships, it’s much harder to monitor each other. 

What about exposure to climate change? Do you have any impressions from your fieldwork how this might change cooperation?

All the coastal communities in Bougainville have already experienced the consequences of climate change, because they have already had to relocate. Sea levels have risen and the land is sinking due to tectonic movements. But when they had to move, it was not life-threatening. What is life-threatening, and it’s something that’s coming up more and more, is a lack of food. Most people have told me that they have experienced droughts lasting up to six weeks. There is less rain, which is a problem, the temperatures are rising and so they are really suffering from food shortages. They don’t have famines like in Africa yet, but I think they could come close to such situations. In some places they have told me, that they are no longer able to grow certain foods. So that’s worrying.  Here in Passau, with the help of Professor Graf Lambsdorff’s team, in particular Dr Katharina Werner, I will be analysing the data that we have collected to see if these experiences have changed our findings on social cohesion. 

You travelled the 36,000 kilometres from Kiel to Bougainville and back without flying. According to your calculations, you saved 7.6 tonnes of CO2, but in the end you lost your job. Is it economically rational to take the train instead of the plane?

Dr Grimalda shares a research interest in experimental economics with Professor Graf Lambsdorff from the University of Passau.

Definitely not economically rational. I stopped looking at airfares a long time ago because I did not want to see how cheap the flights were compared to the train, because that would have made me angry. I calculated that this trip from Germany to Papua New Guinea, both ways, cost me about 1600 Euros more than a flight, mainly because I had to spend a lot of money on visas. But what comes up is that slow travel, surface travel, is ten times less polluting than flying, which makes a big difference.

But why is this not reflected in the fares?

First, we still don’t pay taxes on the fuel of aeroplanes. And the second thing is that you don’t have to pay for the infrastructure. Of course you have the airport, but you don’t have the tracks. With the railway tracks, they belong to a company, so it’s clear who has to take care of the infrastructure. In the case of aeroplanes, you have the air, the atmosphere, and of course the pollution from the greenhouse gas emissions is very damaging to this infrastructure, but it’s a public good and nobody pays for it. Many economists propose the idea of a carbon tax, also to incorporate, to internalise these costs, but because the costs don’t specifically damage a country, they are not taxed. There is a problem of attribution of the public good.

So we have a market failure here and a lack of cooperation at the international level. What can economists do?

With experimental economics we try to see under what conditions people are willing to cooperate. And we have made progress because we have developed the theory of direct and indirect reciprocity. That is, members of a community observe each other, and if they see that I am doing something good for another person, the observing person will eventually do something good for me. In one of our experiments with university students from different countries, we were able to show that groups that cooperate well at the national level can also influence the cooperation at the international level. I was really surprised that this kind of good cooperation can spread. This suggests that in international cooperation, people who are good at cooperating can really spread this norm of cooperation to the others. 

Interview: Kathrin Haimerl

During his stay at the University of Passau, Dr Gianluca Grimalda will also give lectures on his research. Please check the PICAIS website for details. If you would like to contact Dr Grimalda, please write to the PICAIS office via

Further readings to topics that Dr Grimalda mentions in the interview:

Engel, C. (2011). Dictator games: A meta study. Experimental economics, 14, 583-610.

Fischbacher, U., Gächter, S., & Fehr, E. (2001). Are people conditionally cooperative? Evidence from a public goods experiment. Economics letters, 71(3), 397-404.

Berg, J., Dickhaut, J., & McCabe, K. (1995). Trust, reciprocity, and social history. Games and economic behavior, 10(1), 122-142.

Johnson, N. D., & Mislin, A. A. (2011). Trust games: A meta-analysis. Journal of economic psychology, 32(5), 865-889.

Bowles, S., & Gintis, H. (2002). Homo reciprocans. Nature, 415(6868), 125-127.

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