Examining the role of fairness in high stakes allocation decisions
AbstractRecent experimental evidence has led to a debate about the nature of utility functions in which people are concerned about the amount others earn, and what factors heighten or diminish social preference. We explore fairness by examining behavior across three variants of the dictator game. Using data from nearly 200 dictators allocating as much as $100 each, we observe that fairness considerations are very powerfulâwhen subjects could reasonably believe that disproportionately low offers are âfairâ, only 8-12 percent of dictators make positive offers. Examining the comparative static results from these allocation decisions, we find that recent theoretical models of inequality do a respectable job of explaining the data patterns.
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Bibliographic InfoArticle provided by Elsevier in its journal Journal of Economic Behavior & Organization.
Volume (Year): 65 (2008)
Issue (Month): 1 (January)
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- Todd L. Cherry & John A. List, 2004. "Examining the Role of Fairness in High Stakes Allocation Decisions," Working Papers 04-01, Department of Economics, Appalachian State University.
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