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Equality-Efficiency Trade-off within French and German Couples – A Comparative Experimental Study

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  • Hélène Couprie
  • Miriam Beblo
  • Denis Beninger
  • François Cochard
  • Astrid Hopfensitz

    ()
    (THEMA, Universite de Cergy-Pontoise and THEMA
    Universität Hamburg
    Universität Hamburg and University of Strasbourg
    Université de Franche-Comté (CRESE))

Abstract

We present the results of an experiment measuring social preferences within couples in a context where intra-household pay-off inequality can be reduced at the cost of diminishing household income. We measure social norms regarding this efficiency-equality trade-off and implement a cross-country comparison between France and Germany. In particular, we show that German households are more inequality averse and are thus less efficient than French households. A decomposition of this difference reveals that approximately 40% is driven by diverging sample compositions in the two countries, while 60% of the initial French/German difference remains unexplained. Beliefs differ significantly from observed behavior in both countries. Efficient choices are overestimated in the German sample and underestimated in the French.

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Bibliographic Info

Paper provided by THEMA (THéorie Economique, Modélisation et Applications), Université de Cergy-Pontoise in its series THEMA Working Papers with number 2012-44.

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Date of creation: 2012
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Handle: RePEc:ema:worpap:2012-44

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Keywords: Intra-household allocation; Inequality aversion; Pareto efficiency; social norms;

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  8. Oaxaca, Ronald, 1973. "Male-Female Wage Differentials in Urban Labor Markets," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 14(3), pages 693-709, October.
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