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Testing Guilt Aversion

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Author Info

  • Ellingsen, Tore

    ()
    (Department of Economics, Stockholm School of Economics,)

  • Johannesson, Magnus

    ()
    (Department of Economics, Stockholm School of Economics,)

  • Tjøtta, Sigve

    ()
    (University of Bergen, Department of Economics)

  • Torsvik, Gaute

    ()
    (University of Bergen, Department of Economics)

Abstract

Guilt averse individuals experience a utility loss if they believe they let someone down. In particular, generosity depends on what the donor believes that the recipient expects to receive. In experimental work, several authors have identified a positive correlation between such second-order donor beliefs and generous behavior, as predicted by the guilt aversion hypothesis. However, the correlation could alternatively be due to a “false consensus effect,” i.e., the tendency of people to believe others to think like themselves. In order to test the guilt aversion hypothesis more rigorously, we conduct three separate experiments: a dictator game experiment, a complete information trust game experiment, and a hidden action trust game experiment. In the experiments we inform donors about the beliefs of their respective recipients, while eliciting these beliefs so as to maximize recipient honesty. The correlation between generous behavior and donors’ second-order beliefs is close to zero in all three experiments.

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Bibliographic Info

Paper provided by University of Bergen, Department of Economics in its series Working Papers in Economics with number 14/07.

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Length: 38 pages
Date of creation: 15 Dec 2007
Date of revision:
Handle: RePEc:hhs:bergec:2007_014

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Postal: Institutt for økonomi, Universitetet i Bergen, Postboks 7802, 5020 Bergen, Norway
Phone: (+47)55589200
Fax: (+47)55589210
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Web page: http://www.uib.no/econ/en
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Keywords: guilt aversion; beliefs; generosity; experiments.;

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References

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