Revealed preferences and aspirations in warm glow theory

Vadim Cherepanov, Tim Feddersen, Alvaro Sandroni*

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

11 Scopus citations

Abstract

In warm glow models, an agent may prefer one alternative but aspire to choose another. The agent chooses her aspiration if she gets a sufficiently large warm glow payoff for acting as she aspires. This basic framework is widely used in models of turnout in elections and contributions to public goods, but is often criticized for being ad hoc. In this paper, we provide choice-theoretic foundations for warm glow theory. We characterize the empirical content of warm glow theory, show how to infer the core elements of the model from data and show that it is possible to predict behavior even when preferences and aspirations are not revealed. Our results provide support for assumptions often made in the literature and suggest new applications for warm glow models.

Original languageEnglish (US)
Pages (from-to)501-535
Number of pages35
JournalEconomic Theory
Volume54
Issue number3
DOIs
StatePublished - Jan 1 2013

Keywords

  • Aspirations
  • Choice
  • Revealed preferences
  • Warm glow

ASJC Scopus subject areas

  • Economics and Econometrics

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