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Delegating to a Powerless Intermediary: Does It Reduce Punishment?

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  • Grossman, Zachary
  • Oexl, Regine

Abstract

Beyond the classical reasons of efficiency, commitment, the distribution of information, or incentive provision, a person may also delegate decision rights so as to avoid blame for an unpopular or immoral decision. We show that by delegating to an intermediary, a dictator facing an allocation decision can effectively shift moral responsibility onto the delegee even when doing so necessarily eliminates the possibility of a fair outcome. Dictators who choose selfishly via an intermediary are punished less and earn greater profits than those who directly choose a selfish outcome, while the intermediary is punished more.

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Bibliographic Info

Paper provided by Department of Economics, UC Santa Barbara in its series University of California at Santa Barbara, Economics Working Paper Series with number qt0119d201.

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Date of creation: 30 Aug 2011
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Handle: RePEc:cdl:ucsbec:qt0119d201

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Keywords: intermediation; delegation; punishment; responsibility; attribution; blame shifting; experimental economics; behavioral economics; Social and Behavioral Sciences;

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  1. Charness, Gary & Rabin, Matthew, 2001. "Understanding Social Preferences with Simple Tests," Department of Economics, Working Paper Series, Department of Economics, Institute for Business and Economic Research, UC Berkeley qt4qz9k8vg, Department of Economics, Institute for Business and Economic Research, UC Berkeley.
  2. Mathias Dewatripont & Patrick Bolton, 2005. "Contract theory," ULB Institutional Repository, ULB -- Universite Libre de Bruxelles 2013/9543, ULB -- Universite Libre de Bruxelles.
  3. Aghion, Philippe & Tirole, Jean, 1997. "Formal and Real Authority in Organizations," Scholarly Articles 4554125, Harvard University Department of Economics.
  4. Björn Bartling & Urs Fischbacher, 2012. "Shifting the Blame: On Delegation and Responsibility," Review of Economic Studies, Oxford University Press, Oxford University Press, vol. 79(1), pages 67-87.
  5. Jason Dana & Roberto Weber & Jason Kuang, 2007. "Exploiting moral wiggle room: experiments demonstrating an illusory preference for fairness," Economic Theory, Springer, Springer, vol. 33(1), pages 67-80, October.
  6. Dufwenberg, M. & Kirchsteiger, G., 1998. "A Theory of Sequential Reciprocity," Discussion Paper, Tilburg University, Center for Economic Research 1998-37, Tilburg University, Center for Economic Research.
  7. Fershtman, C & Gneezy, U, 1996. "Strategic Delegation : An Experiment," Papers, Tel Aviv 43-96, Tel Aviv.
  8. Grossman, Zachary, 2010. "Strategic Ignorance and the Robustness of Social Preferences," University of California at Santa Barbara, Economics Working Paper Series, Department of Economics, UC Santa Barbara qt60b93868, Department of Economics, UC Santa Barbara.
  9. John R. Hamman & George Loewenstein & Roberto A. Weber, 2010. "Self-Interest through Delegation: An Additional Rationale for the Principal-Agent Relationship," American Economic Review, American Economic Association, American Economic Association, vol. 100(4), pages 1826-46, September.
  10. Greiner, Ben, 2004. "An Online Recruitment System for Economic Experiments," MPRA Paper 13513, University Library of Munich, Germany.
  11. Paharia, Neeru & Kassam, Karim S. & Greene, Joshua D. & Bazerman, Max H., 2009. "Dirty work, clean hands: The moral psychology of indirect agency," Organizational Behavior and Human Decision Processes, Elsevier, Elsevier, vol. 109(2), pages 134-141, July.
  12. Urs Fischbacher, 2007. "z-Tree: Zurich toolbox for ready-made economic experiments," Experimental Economics, Springer, Springer, vol. 10(2), pages 171-178, June.
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Cited by:
  1. Erat, Sanjiv, 2013. "Avoiding lying: The case of delegated deception," Journal of Economic Behavior & Organization, Elsevier, Elsevier, vol. 93(C), pages 273-278.
  2. Owens, David & Grossman , Zachary & Fackler , Ryan, 2012. "The Control Premium: A Preference for Payoff Autonomy," University of California at Santa Barbara, Economics Working Paper Series, Department of Economics, UC Santa Barbara qt5bg845s1, Department of Economics, UC Santa Barbara.

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