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Are People Willing to Pay to Reduce Others'Incomes?

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  • Daniel J. Zizzo
  • Andrew J. Oswald

Abstract

This paper studies utility interdependence in the laboratory: subjects can pay to reduce ("burn") other subjects' money. Most of them do. The price elasticity of burning is mostly less than unity. There is a strong correlation between wealth, or rank, and the amounts by which subjects are burnt. Many burners, especially disadvantaged ones, care about whether another person "deserves" the money he has. Deservingness is not simply a matter of relative payoff.

Suggested Citation

  • Daniel J. Zizzo & Andrew J. Oswald, 2001. "Are People Willing to Pay to Reduce Others'Incomes?," Annals of Economics and Statistics, GENES, issue 63-64, pages 39-65.
  • Handle: RePEc:adr:anecst:y:2001:i:63-64:p:39-65
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    More about this item

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution

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