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Testing Guilt Aversion

  • Ellingsen, Tore

    ()

    (Dept. of Economics, Stockholm School of Economics)

  • Johannesson, Magnus

    ()

    (Dept. of Economics, Stockholm School of Economics)

  • Tjøtta, Sigve

    ()

    (Department of Economics, University of Bergen)

  • Torsvik, Gaute

    ()

    (Department of Economics, University of Bergen)

Guilt averse individuals experience a utility loss if they believe they let someone down. In particular, generosity depends on what the donor believes that the recipient expects to receive. In experimental work, several authors have identified a positive correlation between such second-order donor beliefs and generous behavior, as predicted by the guilt aversion hypothesis. However, the correlation could alternatively be due to a “false consensus effect,” i.e., the tendency of people to believe others to think like themselves. In order to test the guilt aversion hypothesis more rigorously, we conduct three separate experiments: a dictator game experiment, a complete information trust game experiment, and a hidden action trust game experiment. In the experiments we inform donors about the beliefs of their respective recipients, while eliciting these beliefs so as to maximize recipient honesty. The correlation between generous behavior and donors’ second-order beliefs is close to zero in all three experiments.

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Paper provided by Stockholm School of Economics in its series SSE/EFI Working Paper Series in Economics and Finance with number 683.

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Length: 38 pages
Date of creation: 07 Dec 2007
Date of revision:
Handle: RePEc:hhs:hastef:0683
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