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Are dictators averse to inequality?

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  • Korenok, Oleg
  • Millner, Edward L.
  • Razzolini, Laura

Abstract

We present the results of an experiment designed to identify more clearly the motivation underlying dictators’ behavior. In the typical dictator game, recipients are given no endowment. We give an endowment to the recipient as well as the dictator. This new dimension allows us to test directly for inequality aversion. Our results confirm that the inequality between dictator's and recipient's endowment is a key determinant of the dictator's giving. As we increase the recipient's endowment from 0 to an amount equal to the dictator's endowment, the mean amount passed drops from 30 percent to less than 12 percent of the dictator's endowment, and the proportion of dictators who pass positive amounts falls from 75 percent to 26 percent. Thus the majority of dictators exhibit behavior consistent with inequality averse preferences. On the other hand, only 24 percent of dictators split payoffs equally suggesting that maximin preferences are less important drivers of dictators’ giving.

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Bibliographic Info

Article provided by Elsevier in its journal Journal of Economic Behavior & Organization.

Volume (Year): 82 (2012)
Issue (Month): 2 ()
Pages: 543-547

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Handle: RePEc:eee:jeborg:v:82:y:2012:i:2:p:543-547

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Web page: http://www.elsevier.com/locate/jebo

Related research

Keywords: Dictator game; Other-regarding preferences; Maximin; Altruism;

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References

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  1. Konow, James, 2010. "Mixed feelings: Theories of and evidence on giving," Journal of Public Economics, Elsevier, vol. 94(3-4), pages 279-297, April.
  2. John A. List, 2007. "On the Interpretation of Giving in Dictator Games," Journal of Political Economy, University of Chicago Press, vol. 115, pages 482-493.
  3. Fehr, Ernst & Schmidt, Klaus M., . "A theory of fairness, competition, and cooperation," Chapters in Economics, University of Munich, Department of Economics.
  4. Engelmann,Dirk & Strobel,Martin, 2002. "Inequality Aversion, Efficiency, and Maximin Preferences in Simple Distribution Experiments," Research Memorandum 015, Maastricht University, Maastricht Economic Research Institute on Innovation and Technology (MERIT).
  5. Nicholas Bardsley, 2008. "Dictator game giving: altruism or artefact?," Experimental Economics, Springer, vol. 11(2), pages 122-133, June.
  6. Bolton, G. & Katok, E., 1995. "An Experimental Test of the Crowding Out Hypothesis: The Nature of Beneficient Behavior," UFAE and IAE Working Papers 295.95, Unitat de Fonaments de l'Anàlisi Econòmica (UAB) and Institut d'Anàlisi Econòmica (CSIC).
  7. Eckel, Catherine C. & Grossman, Philip J. & Johnston, Rachel M., 2005. "An experimental test of the crowding out hypothesis," Journal of Public Economics, Elsevier, vol. 89(8), pages 1543-1560, August.
  8. Crumpler, Heidi & Grossman, Philip J., 2008. "An experimental test of warm glow giving," Journal of Public Economics, Elsevier, vol. 92(5-6), pages 1011-1021, June.
  9. Charness, Gary & Rabin, Matthew, 2001. "Understanding Social Preferences with Simple Tests," Department of Economics, Working Paper Series qt4qz9k8vg, Department of Economics, Institute for Business and Economic Research, UC Berkeley.
  10. Andreoni, James, 1989. "Giving with Impure Altruism: Applications to Charity and Ricardian Equivalence," Journal of Political Economy, University of Chicago Press, vol. 97(6), pages 1447-58, December.
  11. William S. Neilson, 1993. "An Expected Utility-User's Guide to Nonexpected Utility Experiments," Eastern Economic Journal, Eastern Economic Association, vol. 19(3), pages 257-274, Summer.
  12. Battalio, Raymond C & Kagel, John H & Jiranyakul, Komain, 1990. " Testing between Alternative Models of Choice under Uncertainty: Some Initial Results," Journal of Risk and Uncertainty, Springer, vol. 3(1), pages 25-50, March.
  13. Axel Ockenfels & Gary E. Bolton, 2000. "ERC: A Theory of Equity, Reciprocity, and Competition," American Economic Review, American Economic Association, vol. 90(1), pages 166-193, March.
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Cited by:
  1. Subhasish M. Chowdhury & Joo Young Jeon, 2013. "Altruism, Anticipation, and Gender," Working Paper series, University of East Anglia, Centre for Behavioural and Experimental Social Science (CBESS) 13-06, School of Economics, University of East Anglia, Norwich, UK..
  2. Subhashish Modak Chowdhury & Joo Young Jeon, 2012. "Income effect and altruism," Working Paper series, University of East Anglia, Centre for Behavioural and Experimental Social Science (CBESS) 12-04, School of Economics, University of East Anglia, Norwich, UK..
  3. Korenok Oleg & Edward L. Millner & Laura Razzolini, 2013. "Taking, Giving, and Impure Altruism in Dictator Games," Working Papers 1301, VCU School of Business, Department of Economics.

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