These are my notes on social economics.
The foundations for demand curves include what you want, prices of goods and services, and how much money you have to spend.
Helping others has become very important in modern economics. A lot of people volunteer in developed countries. Giving money to causes is also a popular way to help others.
Economists view the reasons for giving as falling into two broad categories, to help others and to help one self.
Pure altruism is a behavior with a primary motivation to help others.
Impure altruism is a behavior with a primary motivation to make oneself feel good. It is primarily motivated by selfish considerations.
Fairness is the willingness of individuals to sacrifice their own well-being to either improve on the well-being of others or punish those whom they perceive as behaving unkindly.
Peer effects are the influence of the decisions of others on our own choices.
Herding is a behavior of individuals who conform to the decisions of others.
An information cascade occurs when people make the same decisions as others, ignoring their own private information.
Nothing in economics dictates that agents must value only material worth. Introspection suggests that we value many things beyond wealth, including charity, fairness, trust, revenge, and how others perceive us. Our economic tools provide us with an understanding of when such considerations have importance.
Economists have also explored how predictions in economics change when we consider an agent who acts more human. Our economic reasoning remains intact when we add such considerations.
In this way, predictions from the standard economic model are quite robust and help us study features of our economy such as fairness, revenge, charity, trust, and peer effects.
Taken together, these factors help us understand the world around us and how economics can be extended to every corner of our economy.