Are People Self-Interested or Altruistic?

Now, don't rush to judgment. Consider the real meaning of those words: "Self-interested" and "Altruistic". "Self-interested" doesn't mean lying, stealing, cheating, or beating people up for lunch money. It simply means that, given the option, you'd choose which one you like most. It is self-interested of you to order your favorite flavor of ice cream at Baskin Robbins. It is self-interested of you to accept a position that pays more than another position. And it is also self interest that motivates a burglar to steal your stuff. Clearly, self-interest is not synonymous with honest. You can be honest and self-interested.

Now consider "altruistic". Altruism means that you want other people to be happy more than you want yourself to be happy. In other words, you'd be "happier" if everyone else was happier. Altruistic people would be more concerned with finding ways to make other people happy, right? So do we observe any altruistic people that are honestly just trying to make other people happy? Every day I see people acting self-interestedly. Just the other day I was shopping at a fabric store, and I saw a woman use a coupon while paying for her purchases! The greed! Oh the insatiable greed of humankind! This woman actually preferred to pay the store LESS money and get the same amount of goods. Did she even stop to CONSIDER how the store FELT about that? I'm sure the store would have preferred that she pay full price for her purchases. And if that woman hadn't been so self-interested as to use a coupon, they would have received more money from her. The woman could have chosen to not use the coupon and just pay full price, and that would have demonstrated much greater altruism. In fact, the ultimate altruistic act would be for the woman to just donate her money without taking anything from the fabric store. (See what I'm getting at here?) People act self-interested all the time, and there's nothing wrong (criminally or morally) with that. So just accept it.

In economics, we assume everyone is self-interested. It's easier that way. It makes our little models and equations work (because I can find the maximum point on a curve quite easily) and it seems to most closely follow actual human behavior. I just wanted to clear that up before we get too involved in discussing the economics of everyday things. Because as I analyze situations, I automatically assume everyone is self-interested...and usually I'm right.

In a fun little mind-bender, consider this: Altruistic people set about doing things to make other people happy, because it makes themSELVES happy also. So, even altruistic people are self-interested! It just happens to be that they make themselves happy by making other people happy...but in the end, they're still doing it because it makes them happy to do so. Sounds like self-interest to me.