Social Preferences in Private Decisions
AbstractSocial preference models were originally constructed to explain two things: why people spend money to affect the earnings of others and why the income of others influences reported happiness. We test these models in a novel experimental situation where participants face a risky decision that affects only their own earnings. In the social (individual) treatment participants do (not) observe the earnings of others. In the social treatment gambles therefore not only affect absolute but also relative earnings. Outcome-based social preference models therefore predict a treatment difference. We find that decisions are generally the same in both treatments, in line with rule-based social preference models, like procedural fairness.
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Bibliographic InfoPaper provided by Tinbergen Institute in its series Tinbergen Institute Discussion Papers with number 12-003/1.
Date of creation: 09 Jan 2012
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fairness; social preferences; decision making under risk; experiment;
Find related papers by JEL classification:
- C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
- D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
- D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty
This paper has been announced in the following NEP Reports:
- NEP-ALL-2012-01-25 (All new papers)
- NEP-CBE-2012-01-25 (Cognitive & Behavioural Economics)
- NEP-EVO-2012-01-25 (Evolutionary Economics)
- NEP-EXP-2012-01-25 (Experimental Economics)
- NEP-SOC-2012-01-25 (Social Norms & Social Capital)
- NEP-UPT-2012-01-25 (Utility Models & Prospect Theory)
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