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On inequity aversion: A reply to Binmore and Shaked

  • Fehr, Ernst
  • Schmidt, Klaus M.

In this paper we reply to Binmore and Shaked's criticism of the Fehr-Schmidt model of inequity aversion. We put the theory and their arguments into perspective and show that their criticism is not substantiated. Finally, we briefly comment on the main challenges for future research on social preferences.

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Article provided by Elsevier in its journal Journal of Economic Behavior & Organization.

Volume (Year): 73 (2010)
Issue (Month): 1 (January)
Pages: 101-108

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Handle: RePEc:eee:jeborg:v:73:y:2010:i:1:p:101-108
Contact details of provider: Web page: http://www.elsevier.com/locate/jebo

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  16. Ernst Fehr & Klaus M. Schmidt, 2005. "The Rhetoric of Inequity Aversion – Reply," Levine's Bibliography 666156000000000574, UCLA Department of Economics.
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  22. Engelmann Dirk & Strobel Martin, 2002. "Inequality Aversion, Efficiency, and Maximin Preferences in Simple Distribution Experiments," Research Memorandum 015, Maastricht University, Maastricht Economic Research Institute on Innovation and Technology (MERIT).
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  24. Kosfeld, Michael & Okada, Akira & Riedl, Arno, 2006. "Institution Formation in Public Goods Games," IZA Discussion Papers 2288, Institute for the Study of Labor (IZA).
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