Is the veil of ignorance only a concept about risk? An experiment

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Is the veil of ignorance only a concept about risk? An experiment

Author Info

Hannah Hörisch () (University of Munich, Seminar for Economic Theory, Ludwigstraße 28 (Rgb.), 80539 Munich, Germany, email: hannah.hoerisch@lrz.uni-muenchen.de.)

Abstract

We implement the Rawlsian veil of ignorance in the laboratory. Our experimental design allows separating the effects of risk and social preferences behind the veil of ignorance. Subjects prefer more equal distributions behind than in front of the veil of ignorance, but only a minority acts according to maximin preferences. Men prefer more equal allocations mostly for insurance purposes, women also due to social preferences for equality. Our results contrast the Utilitarian's claim that behind the veil of ignorance maximin preferences necessarily imply infinite risk aversion. They are compatible with any degree of risk aversion as long as social preferences for equality are sufficiently strong.

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Paper provided by SFB/TR 15 Governance and the Efficiency of Economic Systems, Free University of Berlin, Humboldt University of Berlin, University of Bonn, University of Mannheim, University of Munich in its series Discussion Papers with number 230.

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Date of creation: Feb 2008
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Handle: RePEc:trf:wpaper:230

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Find related papers by JEL classification:
D64 - Microeconomics - - Welfare Economics - - - Altruism
C99 - Mathematical and Quantitative Methods - - Design of Experiments - - - Other
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-2008-09-13 (All new papers)
NEP-CBE-2008-09-13 (Cognitive & Behavioural Economics)
NEP-EXP-2008-09-13 (Experimental Economics)
NEP-HPE-2008-09-13 (History & Philosophy of Economics)
NEP-UPT-2008-09-13 (Utility Models & Prospect Theory)

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