Retaliation and Reciprocity

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Fairness Retaliation and Reciprocity

"A man ought to be a friend to his friend and repay a gift with gift. People should meet smiles with smiles and lies with treachery."(Fehr and Gaechter, from the Edda)

• Reciprocity

The concept of reciprocity is a rather straight-forward one. Reciprocity deals with actions that are simply responses, not necessarily actions that will lead to future material gains. If an individual acts cooperatively and kindly towards another, positive reciprocity indicates that this action will be met with a response of an equally kind magnitude.

• Retaliation

On the opposite side of the spectrum is the concept of retaliation, sometimes referred to as negative reciprocity. In the event that an individual is met with an absurdly unfair offer, or suspects a negative action on the part of another, he will retaliate and punish that individual for engaging in such behavior - even if that retaliatory action is detrimental to himself!

It is also quite important to note here that there "seems to be an emerging consensus that the propensity to punish harmful behavior is stronger than the propensity to reward friendly behavior." (Offerman, Charness and Rabin - as noted by Fehr and Gaechter)