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Equity Aversion: Social Norms and the Desire to Be Ahead

Author

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  • Chaim Fershtman
  • Uri Gneezy
  • John A. List

Abstract

Inequity aversion models have dominated the behavioral economics landscape in the last decade. This study uses variants of dictator and trust games to provide empirical content to these models. We manipulate market features—such as competition over resources—to demonstrate that extant models cannot explain realistic manipulations of either game. For example, we show that if socially acceptable actions provide one player with a greater portion of the rents, she will put forth extra effort to secure them, to the detriment of the other person. When she can earn more than the other player through customary actions, we find a preference for selfishness. (JEL C71, C70, D03, Z13)

Suggested Citation

  • Chaim Fershtman & Uri Gneezy & John A. List, 2012. "Equity Aversion: Social Norms and the Desire to Be Ahead," American Economic Journal: Microeconomics, American Economic Association, vol. 4(4), pages 131-144, November.
  • Handle: RePEc:aea:aejmic:v:4:y:2012:i:4:p:131-44
    Note: DOI: 10.1257/mic.4.4.131
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    References listed on IDEAS

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    1. repec:bla:econom:v:84:y:2017:i:335:p:498-515 is not listed on IDEAS
    2. Balafoutas, Loukas & Kerschbamer, Rudolf & Kocher, Martin & Sutter, Matthias, 2014. "Revealed distributional preferences: Individuals vs. teams," Journal of Economic Behavior & Organization, Elsevier, vol. 108(C), pages 319-330.
    3. repec:eee:joepsy:v:64:y:2018:i:c:p:1-17 is not listed on IDEAS
    4. Beck Hanno, 2013. "Alles eine Frage der Perspektive: Anmerkungen zum Buch „Umverteilung und soziale Gerechtigkeit“ von Bernd Genser, Hans Jürgen Ramser und Manfred Stadler," ORDO. Jahrbuch für die Ordnung von Wirtschaft und Gesellschaft, De Gruyter, vol. 64(1), pages 497-500, January.
    5. Gill, David & Stone, Rebecca, 2015. "Desert and inequity aversion in teams," Journal of Public Economics, Elsevier, vol. 123(C), pages 42-54.
    6. Lahno, Amrei M. & Serra-Garcia, Marta, 2012. "Peer Effects in Risk Taking," Discussion Papers in Economics 14309, University of Munich, Department of Economics.
    7. Gebhard Kirchgässner, 2014. "On Self-Interest and Greed," CREMA Working Paper Series 2014-12, Center for Research in Economics, Management and the Arts (CREMA).
    8. Gibson, Rajna & Tanner, Carmen & Wagner, Alexander F, 2014. "The Choice of Honesty: An Experiment Regarding Heterogeneous Responses to Situational Social Norms," CEPR Discussion Papers 9880, C.E.P.R. Discussion Papers.
    9. repec:jdm:journl:v:12:y:2017:i:3:p:208-223 is not listed on IDEAS
    10. Rau, Holger & Müller, Stephan, 2017. "Decisions under Uncertainty in Social Contexts," Annual Conference 2017 (Vienna): Alternative Structures for Money and Banking 168228, Verein für Socialpolitik / German Economic Association.
    11. Luca Zarri, 2013. "Altruism," Chapters,in: Handbook on the Economics of Reciprocity and Social Enterprise, chapter 1, pages 9-19 Edward Elgar Publishing.
    12. Amrei M. Lahno & Marta Serra-Garcia, 2012. "Peer Effects in Risk Taking," CESifo Working Paper Series 4057, CESifo Group Munich.
    13. Vandegrift, Donald & Duke, Kristen, 2015. "Competitive behavior, impact on others, and the number of competitors," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 57(C), pages 37-44.
    14. Serhiy Kandul & Olexandr Nikolaychuk, 2017. "I deserve more! An experimental analysis of illusory ownership in dictator games," IRENE Working Papers 17-12, IRENE Institute of Economic Research.
    15. Rudolf Kerschbamer & Matthias Sutter & Uwe Dulleck, 2017. "How Social Preferences Shape Incentives in (Experimental) Markets for Credence Goods," Economic Journal, Royal Economic Society, vol. 127(600), pages 393-416, March.
    16. Frederik Schwerter, 2013. "Social Reference Points and Risk Taking," Bonn Econ Discussion Papers bgse11_2013, University of Bonn, Germany, revised Jan 2014.
    17. Xu, Zhicheng & Palma, Marco A., 2015. "To buy or not buy (insurance)? An experiment on public funds distribution under different rooted risks," 2015 Annual Meeting, January 31-February 3, 2015, Atlanta, Georgia 196649, Southern Agricultural Economics Association.
    18. Kerschbamer, Rudolf, 2015. "The geometry of distributional preferences and a non-parametric identification approach: The Equality Equivalence Test," European Economic Review, Elsevier, vol. 76(C), pages 85-103.
    19. Rudolf Kerschbamer, 2013. "The Geometry of Distributional Preferences and a Non-Parametric Identification Approach," Working Papers 2013-25, Faculty of Economics and Statistics, University of Innsbruck.
    20. Yilmaz Yildiz & Ozgur Arslan-Ayaydin & Mehmet Baha Karan, 2016. "Payment Persistence of Participants in Turkish Private Pension Scheme and Gender Differences," International Journal of Economics and Finance, Canadian Center of Science and Education, vol. 8(10), pages 159-166, October.
    21. Schwerter, Frederik, 2015. "Social Reference Points and Risk Taking," Annual Conference 2015 (Muenster): Economic Development - Theory and Policy 112889, Verein für Socialpolitik / German Economic Association.
    22. Halevy, Yoram & Peters, Michael, 2007. "Other Regarding Preferences: Outcomes, Intentions, or Interdependence," Microeconomics.ca working papers peters-07-03-31-11-46-48, Vancouver School of Economics, revised 24 Jun 2009.
    23. Müller, Stephan & Rau, Holger A., 2017. "Decisions under uncertainty in social contexts," Center for European, Governance and Economic Development Research Discussion Papers 290, University of Goettingen, Department of Economics.

    More about this item

    JEL classification:

    • C70 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - General
    • C71 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Cooperative Games
    • D03 - Microeconomics - - General - - - Behavioral Microeconomics: Underlying Principles
    • Z13 - Other Special Topics - - Cultural Economics - - - Economic Sociology; Economic Anthropology; Language; Social and Economic Stratification

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