Imagine the following situation: a nun has just left the monastery and commenced her journey to the city centre to make weekly purchases. After she finished her shopping, on her way back to the monastery, she stumbled upon a homeless man sitting on the pavement, a small cup placed in front of him and a sign in his hands saying: ‘Homeless single father, need money for family’. The nun, placing her hands in her purse, hears the tinkling of change and decides to give it to him. She then accepts the blessings of the man with a slight nod and continues her way back.

In this article, we will explore the forms of altruism, leveraging insights from philosophy, behavioural economics and neuroeconomics, and probe into the motives of the nun to determine whether her act of giving was indeed selfless.

Defining Altruism

Prior to taking a stance in the debate on altruism, providing a definition of it is imperative. De Quervian et. al. (2004) distinguish between the biological and psychological definitions of altruism. The biological definition treats altruistic behaviour as ‘any costly behaviour that confers an economic benefit to other individuals’, regardless of the motives behind such behaviour. The psychological definition, in contrast, requires that such behaviour is driven by non-hedonic motives, i.e. without any benefit perceived or expected by the giver. In the given situation, even if the act of giving was motivated by the expectation of immaterial or spiritual reward, the nun’s act would still be altruistic under biological, but non-altruistic under psychological interpretation. However, we are concerned with altruism viewed through the lens of psychology, i.e. pure altruism.

Altruism – Egoism Dichotomy

One way to understand whether pure altruism can exist is to think about its antithesis – egoism, the motivational state with the ultimate goal of increasing one’s own welfare. The famous philosophers, Hobbes’ and Nietzche’s views concerning the dichotomy weigh heavily towards egoism. Nietzche, in his book Human, All Too Human, stated that “any social instinct (behaviour performed to help another) is said to be derived from the communal seeking of pleasure and elimination of pain”. A strong resemblance to this idea can be seen in Hobbes’ philosophy. In his classic work Leviathan, he indicated that “no man gives but with the intention of good to himself, because gift is voluntary… and the object is to every man his own good.” Therefore, motives, not consequences, must be used to differentiate altruism from egoism. The two main types of altruism on the basis of motives are warm-glow giving and pure altruism.

• Warm-Glow Theory: The recipient’s well-being is a means to benefit the donor
• Pure Altruism: There are no motives, intrinsic or extrinsic, benefiting the donor

In behavioural economics literature, the concept of egoism is accounted through warm-glow theory, in which the act of giving is a reward to the donor. This can be a mechanism that signals wealth, depicts the donor’s character under a positive light, satisfies the desire for self-assertion, overcomes the fear of retribution of God, or reduces guilt. In our nun example, the last two motives might be the dominant reasons for giving. Accordingly, the most fundamental question of our debate arises: How can we know if there are rewarding motives behind altruistic acts – whether the donor perceives internal or spiritual rewards from the act of giving?

What We Do Know: Insights from Neuroeconomics

Neuroeconomics attempts to answer our questions through investigating neural mechanisms in the human brain. Through the usage of functional magnetic resonance imaging (fMRI), we can identify the parts of the brain whose activity increases during the execution of an act. Therefore, if the activity of a reward centre increases whilst performing an altruistic act, we can argue that pure altruism does not exist.

The illustrated graph is taken from Harbaugh et.al. (2007) neuroeconomics experiment. The two contexts of giving were tax payments (red bars) and voluntary giving (orange bars) to a charity organization.

On the x-axis three parts of the brain (caudate, nucleus accumbens, and insula) are shown, which comprise the reward centre. On the y-axis, the standardized coefficients of activity are depicted. The researchers regard the condition of tax payment as pure altruism since they argue that the motives, in this case, are highly non-hedonic. This is due to both the emotional and physical disconnection between the donor and the recipient. However, a compromise could not be reached in the neuroeconomics literature, since other researchers argued that the incurrence of costs is what caused the activity of the reward centre. In the voluntary case, the increase in the reward centre’s activity emphasizes that the donor has received an intrinsic reward from the act of giving, which can be explained by the warm-glow theory.

Conclusion: Revisiting Motives of the Nun

In conclusion, although insights from numerous science branches concur that warm-glow giving exists, a conclusion has not been reached concerning pure altruism, as it would require the ability to know intrinsic motives behind altruistic acts. Hence, apropos of the nun, the determination of her altruistic stance is as elusive as ever. Hitherto, we do not have the tools which can determine whether she has engaged in the behaviour of giving due to intrinsic rewards or she has given for the sake of helping without expecting anything in return. Neither scientists nor philosophers could agree whether true altruism really exists; maybe it all comes down to your own perceptions of human nature.

Many of the modern economic theories are predicated on the assumption that people are self-interested, i.e. they only take courses of action that elicit pecuniary benefit. Accordingly, one would expect individuals to behave so as to maximise their benefits. Yet, there is a strong body of research evidence indicating that people are strongly motivated by other regarding preferences in their decisions, such as fairness and inequality. Think about the illustrated economic game:

A certain amount of money , say $20, are given to Person A. Person A (giver) can then share any amount at his/her discretion with person B (recipient), who has to accept the given amount. If you were in the place of Person A, would you share your money and, if so, how much?

The assumptions of conventional economics predict the answer to be zero, i.e. the giver keeps $20 for himself/herself. However, in reality, 64% of the participants, on average, shared one-fifth of their endowment. Remarkably, some participants gave away their entire amount. These results highlight that human behaviour is not solely dictated by monetary considerations.

Explaining the Phenomenon: Other-Regarding Preferences

The founding father of economics, Adam Smith, has long formulated the following idea – one who seeks happiness for oneself will not find it; one who helps others will. Individuals gain internal reward in the forms of pleasure, happiness and moral satisfaction from the act of giving, even in cases, in which monetary costs are incurred. In the given example, many people have chosen to give, since the perceived internal reward from giving surpassed the monetary amount given.

Evolutionary biology takes a different standpoint to explain the phenomenon of people’s willingness to give others when they are not obliged to do so. Through the process of natural selection, it may be that evolution favoured people who were co-operative and equitable in exchanges, as the fitness of the group, not the individual, was the essential requirement of survival in nomadic communities. Hence, there is a hard-wired tendency to co-operate, disguised as sharing in the economic game.

Incentivizing Giving: Implications for Non-Profit Organizations

As illustrated in the flow-chart below, in order to arrive to the decision to donate: ( 1 ) people need to recognize the need; ( 2 ) consider the possible impacts of the donation; and ( 3 ) act, if internal reward from giving surpasses monetary costs. Following this model, charity organizations can increase the amount of donations received through addressing the three broad stages of the decision-making process.

The first stage in this process is the recognition stage, in which attention and focus on those in need are imperative for eliciting empathy in potential donators. Hence, organizations need to continuously communicate the need for donation to the public. However, whereas many organizations are successful in the public outreach, only few are successful in increasing the effectiveness of the second stage in our model – consideration stage. Many make the mistake of providing holistic information about the impact of donations, e.g. total number of impoverished students helped. This results in individuals thinking that their donation would not have a substantial impact and perceiving it as a drop in the bucket. It has been consistently shown that willingness to donate is highest, when donations are made to a single person; it is often referred to as singularity effect. Christopher Hsee has found a creative solution to increase group donations by leveraging the singularity effect. A simple, yet powerful, trick consisted of requiring donors to specify how much one would want to give to a single person in need and then asking how many people he/she would like to help. This has significantly increased the size of donations.

Regarding the action stage, it is the step that non-profit organizations should consider with due attention. The fundamental importance of this stage stems from the availability of feedback – as a result of the donation itself – that could be fed back to the donor. In particular, this means providing concrete details about the usage and impact of the donated funds, which proved to substantially increase the tendency of people to donate again. In doing so, a virtuous circle can be established, in which the recognition of the need is re-communicated, and impact considerations are elucidated – simply by increasing the awareness about particular details of the donation outcome.

Altruism highlights that human beings are not purely self-interested, solely focusing on maximizing monetary gains. Instead, we are co-operative, helpful, and prosocial beings, from which we derive intrinsic reward through helping others. However, it is a different question whether true altruism exists, i.e. doing good without expecting anything in return (even in the form of intrinsic reward). The argument of whether pure altruism really exists will be addressed through a philosophical view in our upcoming blog.