Netzer, Nick; Schmutzler, Armin - C.E.P.R. Discussion Papers - 2010
We examine a "Rotten Kid" model (Becker 1974) where a player with social preferences interacts with an egoistic player. We assume that social preferences are intention-based rather than outcome-based. In a very general multi-stage setting we show that any equilibrium must involve mutually unkind...