Do We Really Only Care About Ourselves?
By Samyukta Pai
In August of 2022, over 37,000 people lined up to donate blood in New Zealand, making it the world record of blood donations in a given day. These volunteers weren't getting paid. They weren't promised rewards. So why did they do it? Traditional economics would say it doesn’t make sense–after all, the assumption has always been that humans act out of self-interest, trying to get the most satisfaction or money for themselves. Yet here we are, watching tens of thousands of people give away their time, energy, and even their blood for free.
This is where behavioural economics challenges the old models.
The Classical View
For decades, economics relied on the idea of homo economicus, the so-called “economic man.” He is considered to be rational, calculating, and always maximising his own self-interest. Due to this perspective, economists assume consumers spend money only to maximise their personal satisfaction (or utility), and producers, on the other hand, chase to maximise profits at all times.
This logic makes every nice, neat and simple. Workers demand the highest wages they can get. Firms cut costs and fire workers to stay profitable. Investors only care about the biggest returns. That’s rational economic decision-making in action.
But there’s a problem. Real people don’t always behave this way.
Enter Behavioural Economics
Behavioural economics asks–what if humans aren’t so selfish after all? What if we sometimes care about fairness, morality, or helping others, even at personal cost?
The concept of bounded selfishness suggests that people are selfish only within limits. Yes, we might want to earn money for ourselves, but we’re also willing to donate, volunteer, or share resources when we feel it’s the right thing to do.
Economists have also studied altruism, where people do kind and helpful things for others without expecting anything back. For example, during recessions, some firms choose not to fire workers–even though paying them dips severely into profits–because they value employee wellbeing and community stability.
The Debate
Critics argue that altruism isn’t truly selfless. Donating money might make you “feel good,” or perhaps you have a particular guilt that can only be satisfied by doing a good deed. Maybe volunteering could boost your reputation. Even empathy can be seen as a form of personal satisfaction.
Take YouTuber MrBeast as an example. He’s famous for giving away cars, houses, and even paying for life-saving surgeries. Some see this as pure philanthropy. Others argue it’s still self-interest–his generosity also earns him millions of views, sponsorships, and ad revenue. In this way, altruism could be seen as a smart business strategy that still maximises his personal “utility,” just in a less obvious way.
The father of economics, Adam Smith, confuses this logic. While he famously wrote about self-interest driving markets in The Wealth of Nations, he also emphasised in The Theory of Moral Sentiments that humans are equipped with empathy and a sense of justice. In other words, Smith never saw humans as purely selfish calculators.
So why does it matter?
Understanding altruism and bounded selfishness matters because the application of these concepts goes beyond theory–it affects real policies. Governments design tax incentives for donations, encourage volunteering, and create “nudges” that appeal to fairness or social norms. Companies invest in social responsibility not only to make money but also to build trust and goodwill.
Behavioural economics makes economics more realistic. It tells us that people are complex–sometimes selfish, sometimes generous, often both at once.
So, do we really only care about ourselves? The evidence says no. Humans are not robots chasing profit and satisfaction alone. We donate, share, cooperate, and sometimes sacrifice our own interests for others. While classical economics gave us useful models of rational behaviour, behavioural economics reminds us that real people are guided by empathy, fairness, and moral values too.
And perhaps that’s the best news–because if economics were only about self-interest, the world would be a much colder place.
Glossary
Homo Economicus: The “economic man” — a model of humans as perfectly rational and always acting in their own self-interest.
Utility: The satisfaction or benefit a person gets from consuming a good, service, or even from an action like donating.
Bounded Selfishness: The idea that people are selfish only up to a point; empathy, fairness, and morality can also shape decisions.
Altruism: When someone acts to help others without expecting anything in return.
Signaling: When actions, like donating or philanthropy, also serve to show reputation, wealth, or values to others.
Nudge: A small change in the way choices are presented that can influence people’s behavior without removing their freedom.
