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ECN 340 (200)
Lecture

Lecture 5


Department
Economics
Course Code
ECN 340
Professor
Thomas Barbiero

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Exploitation Of Affection
Exploitation of Affection:
In a loving relationship, one person is concerned about the welfare of the other
Each person in the relationship is both a donor of charitable expression (gifts) and a
recipient
Each person realizes that there is an unwritten social contract between the two
In relationship; feelings for the other person is not always equal
The Affection Model:
Donor of a gift receives pleasure from giving it to the recipient – The less expensive the
gift the more often he/she will give
oDownward sloping demand curve
Gifts can be in the form of money, a box of candy, simply listening to the other person,
providing sexual experience, etc
Gifts are given until MC = MB
But there is a possibility of exploitation!
Exploitation Continued:
The recipient can stubbly say, give me this amount or I will take nothing (deny you the
pleasure of seeing me happy)!
If the recipient askstoo much” the donor may be better off giving nothing
The ability to extract a larger quantity from the donor depends on the number of
alternative recipients for the gifts
The exploitation of the donor will occur only to the extent that the recipient is
unconcerned the welfare of the donor
If the recipient cares, then any reduction in the donor’s welfare will be a reduction in the
recipient’s welfare. I.e.Your happiness is my happiness
Romantic Relationship:
Defn: My happiness depends on the happiness of the person I love
oHow to prove that a person is actually in Love
If I care about my wife, she can make me do things for her I ordinarily wouldn’t do
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