To Give or Not To Give? Equity, Efficiency and Altruistic Behavior in a Survey-Based Experiment
AbstractThis paper presents the results of a survey-based experiment on the role of equity and efficiency for altruistic behavior. Using simple binary decisions for a representative pool of subjects, we find that both equity and efficiency are relevant for the decision to give. However, contrary to the findings in several laboratory experiments, our results indicate that equity plays a major role for altruistic behavior. Differences in relative payoffs have a significant effect on the decision to give. When giving is not costly, more than half of the subjects prefer equal payoffs to a socially efficient but unequal allocation. When giving is Pareto-improving, half the subjects choose to sacrifice a higher pay- off in order to avoid payoff inequality. We also find that preferences, as revealed by experimental choices, are largely consistent with reported pro-social activities, while only weakly related to self-reported well-being.
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Bibliographic InfoPaper provided by Centre for North South Economic Research, University of Cagliari and Sassari, Sardinia in its series Working Paper CRENoS with number 201032.
Date of creation: 2010
Date of revision:
altruism; inequality-aversion; social welfare; envy; large- scale experiment;
Other versions of this item:
- Vittorio Pelligra & Luca Stanca, 2010. "To Give or Not To Give? Equity, Efficiency and Altruistic Behavior in a Survey-Based Experiment," Working Papers 202, University of Milano-Bicocca, Department of Economics, revised Dec 2010.
- C78 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Bargaining Theory; Matching Theory
- C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
- D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
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"Relative payoffs and happiness: an experimental study,"
Journal of Economic Behavior & Organization,
Elsevier, vol. 45(3), pages 301-328, July.
- Gary Charness & Brit Grosskopf, 1999. "Relative payoffs and happiness: An experimental study," Economics Working Papers 436, Department of Economics and Business, Universitat Pompeu Fabra, revised Jan 2000.
- Charness, Gary B & Grosskopf, Brit, 2000. "Relative Payoffs And Happiness: An Experimental Study," University of California at Santa Barbara, Economics Working Paper Series qt8389x8z2, Department of Economics, UC Santa Barbara.
- Brit Grosskopf, 2000. "Relative Payoffs and Happiness: An Experimental Study," Econometric Society World Congress 2000 Contributed Papers 1263, Econometric Society.
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