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Do Wealth Differences Affect Fairness Considerations?

  • Olivier Armantier

The influence of relative wealth on fairness considerations is analyzed in an ultimatum game experiment in which participants receive large and widely unequal initial endowments. Subjects initially demonstrate a concern for fairness. With time however, behavior becomes at odds with both subgame perfection and fairness. Evidence of learning is detected for both proposers and receivers in the estimation of a structural reinforcement learning model. The estimation results suggest that, guided by foregone best responses and an acquired sense of deservingness, rich subjects become more selfish, while poor subjects, influenced only by their own experience, learn to tolerate this behavior. L'influence de la richesse relative sur les préoccupations d'équité est analysée dans un jeu de l'ultimatum dans lequel les participants reçoivent d'importantes dotations initiales largement inégales. Au départ, les sujets démontrent un soucis d'équité. Cependant, avec le temps, leur comportement s'éloigne de la perfection en sous-jeux ainsi que de l'équité. L'estimation d'un modèle structurel d'apprentissage par renforcement montre des signes d'apprentissage autant chez les sujets qui proposent que chez les receveurs. Les résultats de l'estimation suggèrent que, lorsque guidés par les meilleures réponses possibles et par un sens acquis de ce qui leur est dû, les sujets riches deviennent plus égoïstes, alors que les sujets pauvres, influencés uniquement par leur expérience personnelle, apprennent à tolérer ce comportement.

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Paper provided by CIRANO in its series CIRANO Working Papers with number 2006s-13.

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Length: 57 pages
Date of creation: 01 Sep 2006
Date of revision:
Handle: RePEc:cir:cirwor:2006s-13
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