ECN340 Week 4 – Chapter 8
Exploitation of Affection
• In a loving relationship, one person is concerned about the welfare of the other.
• Do you love me? Means Do you want the best for me? In economic terms
• Each person in the relationship is both a donor of charitable expression (gifts) and
• Each person realizes there is an unwritten social contract between the two: try to
make the other person happy
The Affection Model
• Donor of a gift receives pleasure from giving to the recipient the less expensive
the gift the more often he/she will give (Downward sloping demand curve)
• Gifts can be in the form of money, a box of candy, simply listening to the other
person, or providing a sexual experience.
• Gifts are given until MC (Marginal cost) = MB (Marginal benefit)
• But there is a possibility of exploitation!
• The recipient can subtly say, give me this amount or I will take nothing (deny you
the pleasure of seeing me happy)!
• If the recipient asks “too 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 about the welfare of the donor.
• If the recipient cares, then any reduction in the donors’ welfare will be a reduction
in the recipients welfare eg. Your happiness is my happiness
• Defn: My happiness depends on the happiness of the person I love
• If I care about my wife, she can make me do things for her I ordinarily would not
• But if she asks for too much, I can drop her even if I still love her!
• How can I leave my wife even if I love her?! The cost is too high given the
benefits. Love is dynamic depending on how much you have to give/ how they
• Women’s Liberation Movement has i