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Equality of opportunity and the acceptability of outcome inequality

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  • Sugden, Robert
  • Wang, Mengjie

Abstract

In many real-world situations, unfairness of outcomes is not directly related to fairness-related properties of individual decisions; it is an unintended consequence of procedures in which individuals interact. Attitudes to such unfairness may be revealed in emotions of anger and resentment rather than in preferences over alternative decision outcomes. We conjecture that inequality is viewed with relatively little disfavour when it results from procedures that allow individuals equal strategic opportunities. We define a concept of procedural fairness which formalises intuitions about equality of opportunity. We report a Vendetta Game experiment in which negative attitudes to inequality can be expressed in costly and counter-productive ‘taking’ of co-players’ assets. A given degree of material inequality induces more taking if the procedure that has generated it is unfair rather than fair. Surprisingly, there is excess taking by players whom procedural unfairness has benefited as well as by those it has harmed.

Suggested Citation

  • Sugden, Robert & Wang, Mengjie, 2020. "Equality of opportunity and the acceptability of outcome inequality," European Economic Review, Elsevier, vol. 130(C).
  • Handle: RePEc:eee:eecrev:v:130:y:2020:i:c:s0014292120302270
    DOI: 10.1016/j.euroecorev.2020.103597
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    More about this item

    Keywords

    Equality of opportunity; Procedural fairness; Inequality; Vendetta Game;
    All these keywords.

    JEL classification:

    • C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making

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