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Equity versus Efficiency? Evidence from Three-Person Generosity Experiments

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Author Info

  • Werner Güth

    ()
    (Strategic Interaction Group, Max Planck Institute of Economics, Kahlaische Straße 10, 07745 Jena, Germany)

  • Kerstin Pull

    (Human Resource Management and Organization, Eberhard Karls Universität Tübingen, Nauklerstraße 47, 72074 Tübingen, Germany)

  • Manfred Stadler

    (Economic Theory, Eberhard Karls Universität Tübingen, Mohlstraße 36, 72074 Tübingen, Germany)

  • Agnes Stribeck

    (Human Resource Management and Organization, Eberhard Karls Universität Tübingen, Nauklerstraße 47, 72074 Tübingen, Germany)

Abstract

In two-person generosity games, the proposer’s agreement payoff is exogenously given, whereas that of the responder is endogenously determined by the proposer’s choice of the pie size. In three-person generosity games, equal agreement payoffs for two of the players are either exogenously excluded or imposed. We predict that the latter crowds out - or at least weakens - efficiency seeking. Our treatments rely on a 2x3 factorial design, differing in whether the responder or the third (dummy) player is the residual claimant and whether the proposer’s agreement payoff is larger, equal, or smaller than the other exogenously given agreement payoff.

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Bibliographic Info

Article provided by MDPI, Open Access Journal in its journal Games.

Volume (Year): 1 (2010)
Issue (Month): 2 (April)
Pages: 89-102

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Handle: RePEc:gam:jgames:v:1:y:2010:i:2:p:89-102:d:8056

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Related research

Keywords: generosity game; equity; efficiency; experiment;

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Cited by:
  1. Werner Güth & Martin G. Kocher, 2013. "More than thirty years of ultimatum bargaining experiments: Motives, variations, and a survey of the recent literature," Jena Economic Research Papers 2013-035, Friedrich-Schiller-University Jena, Max-Planck-Institute of Economics.

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