Causality in Solving Economic Problems

Abstract

The role of causal beliefs in people’s decisions when faced with economic problems was investigated. Two experiments are reported that vary the causal structure in prisoner’s dilemma-like economic situations. We measured willingness to cooperate or defect and collected justifications and think-aloud protocols to examine the strategies that people used to perform the tasks. We found: (i) Individuals who assumed a direct causal influ ence of their own action upon their competitor’s action tended to be more cooperative in competitive situations. (ii) A variety of different strategies was used to perform these tasks. (iii) Strategies indicative of a direct causal influence led to more cooperation. (iv) Temporal cues were not enough for participants to infer a particular causal relation. It is concluded that people are sensitive to causal structure in these situations, a result consistent with a causal model theory of choice (Sloman & Hagmayer, 2006).