Psychology of Economic Decision-Making
The reciprocity norm is a social principle that suggests individuals are inclined to respond to others' actions with similar actions, often in the form of returning favors or kindness. This norm plays a crucial role in shaping social interactions and economic decisions, fostering cooperation and trust among individuals within a community. It is driven by the expectation that if one person does something for another, the recipient of that favor feels compelled to reciprocate in the future, creating a cycle of mutual benefit.
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