Appendix 1. A formal statement of generosity rules. [See erratum.]

Suppose there are n firms, each of which generates a surplus Si, I = 1 . . . n. A generosity rule is a set of weights that describe the distribution of each firm's surplus among the other firms.

vij = share of Si that is distributed to firm j.

where

The symmetric generosity rule occurs when

Walens (1981) reports that the Kwakiutl chief had to have completely empty boxes at the end of a potlatch. In this case, we can define the Kwakiutl generosity rule, which occurs when for each i,j,

Other generosity rules are of course possible. The pure selfishness, or private profit, rule would be: