Bad luck vs. self-inflicted neediness – An experimental investigation of gift giving in a solidarity game

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Bad luck vs. self-inflicted neediness – An experimental investigation of gift giving in a solidarity game

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Nadja Trhal
Ralf Radermacher

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Nadja Trhal

Abstract

We experimentally examine the impact of self-inflicted neediness on the solidarity behavior of subjects. In one treatment in our solidarity experiment all subjects face the same probability of becoming needy, in the other treatment subjects have the choice between a secure payment and a lottery including a certain probability of becoming needy. Then we ask all subjects how much they will give to losers in their group thus investigating if people are willing to give the same gifts whether or not subjects are responsible for inequality in payoffs. We found evidence for allocative as well as for procedural utility concerns.

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Paper provided by University of Cologne, Department of Economics in its series Working Paper Series in Economics with number 28.

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Date of creation: 21 Aug 2006
Date of revision: 07 Mar 2008
Handle: RePEc:kls:series:0028

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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

This paper has been announced in the following NEP Reports:

NEP-ALL-2006-08-26 (All new papers)
NEP-EXP-2006-08-26 (Experimental Economics)
NEP-SOC-2006-08-26 (Social Norms & Social Capital)
NEP-UPT-2006-08-26 (Utility Models & Prospect Theory)

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