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CEU Economic Seminar Series: It Hurts to Ask

CESS by Bénabou
Thursday, December 15, 2022, 11:15 am – 12:30 pm

We analyze the offering, asking, and granting of help or other benefits as a three-stage game with bilateral private information between a person in need of help and a potential help-giver. Asking entails the risk of rejection, which can be painful: since unawareness of the need can no longer be an excuse, a refusal reveals that the person in need, or the relationship, is not valued very much. We show that a failure to ask can occur even when most helpers would help if told about the need, and that even though a greater need makes help both more valuable and more likely to be granted, it can reduce the propensity to ask. Furthermore, when potential helpers concerned about the recipient’s ask-shyness can make spontaneous offers, this can turn out to be a double-edged sword: offering reveals a more caring type and helps solve the failure-to-ask problem, but not offering reveals a not-so-caring one, and this itself deters asking. This discouragement effect can also generate a trap where those in need wait for an offer, while potential helpers wait for an ask, resulting in significant inefficiencies.

Joint paper with Ania Jaroszewicz, George Loewenstein