IDEAS home Printed from https://ideas.repec.org/p/iza/izadps/dp7567.html
   My bibliography  Save this paper

Do Institutions Affect Social Preferences? Evidence from Divided Korea

Author

Listed:
  • Kim, Byung-Yeon

    () (Seoul National University)

  • Choi, Syngjoo

    () (University College London)

  • Lee, Jungmin

    () (Seoul National University)

  • Lee, Sokbae

    () (Institute for Fiscal Studies, London)

  • Choi, Kyunghui

    () (University of Tokyo)

Abstract

The Cold War division of Korea, regarded as a natural experiment in institutional change, provides a unique opportunity to examine whether institutions affect social preferences. We recruited North Korean refugees and South Korean students to conduct laboratory experiments eliciting social preferences, together with standard surveys measuring subjective attitudes toward political and economic institutions. Our experiments employ widely used dictator and trust games, with four possible group matches between North and South Koreans by informing them of the group identity of their anonymous partners. Experimental behavior and support for institutions differ substantially between and within groups. North Korean refugees prefer more egalitarian distribution in the dictator games than South Korean students, even after controlling for individual characteristics that could be correlated with social preferences; however, two groups show little difference in the trust game, once we control for more egalitarian behavior of North Koreans. North Korean refugees show less support for market economy and democracy than South Korean subjects. Attitudes toward institutions are more strongly associated with the experimental behaviors among South Korean subjects than among North Korean subjects.

Suggested Citation

  • Kim, Byung-Yeon & Choi, Syngjoo & Lee, Jungmin & Lee, Sokbae & Choi, Kyunghui, 2013. "Do Institutions Affect Social Preferences? Evidence from Divided Korea," IZA Discussion Papers 7567, Institute for the Study of Labor (IZA).
  • Handle: RePEc:iza:izadps:dp7567
    as

    Download full text from publisher

    File URL: http://ftp.iza.org/dp7567.pdf
    Download Restriction: no

    Other versions of this item:

    References listed on IDEAS

    as
    1. Chaim Fershtman & Uri Gneezy, 2001. "Discrimination in a Segmented Society: An Experimental Approach," The Quarterly Journal of Economics, Oxford University Press, vol. 116(1), pages 351-377.
    2. Stephen Knack & Philip Keefer, 1997. "Does Social Capital Have an Economic Payoff? A Cross-Country Investigation," The Quarterly Journal of Economics, Oxford University Press, vol. 112(4), pages 1251-1288.
    3. Cox, James C., 2004. "How to identify trust and reciprocity," Games and Economic Behavior, Elsevier, vol. 46(2), pages 260-281, February.
    4. repec:pri:rpdevs:gamespaper.pdf is not listed on IDEAS
    5. Michal Bauer & Julie Chytilová & Barbara Pertold-Gebicka, 2014. "Parental background and other-regarding preferences in children," Experimental Economics, Springer;Economic Science Association, vol. 17(1), pages 24-46, March.
    6. Dean S. Karlan, 2005. "Using Experimental Economics to Measure Social Capital and Predict Financial Decisions," American Economic Review, American Economic Association, pages 1688-1699.
    7. Roland Benabou & Jean Tirole, 2011. "Laws and Norms," NBER Working Papers 17579, National Bureau of Economic Research, Inc.
    8. Marcus Noland & Stephan Haggard, 2011. "Witness to Transformation: Refugee Insights into North Korea," Peterson Institute Press: All Books, Peterson Institute for International Economics, number 4389.
    9. Gachter, Simon & Herrmann, Benedikt & Thoni, Christian, 2004. "Trust, voluntary cooperation, and socio-economic background: survey and experimental evidence," Journal of Economic Behavior & Organization, Elsevier, vol. 55(4), pages 505-531, December.
    10. Samuel Bowles, 1998. "Endogenous Preferences: The Cultural Consequences of Markets and Other Economic Institutions," Journal of Economic Literature, American Economic Association, pages 75-111.
    11. Algan, Yann & Cahuc, Pierre, 2014. "Trust, Growth, and Well-Being: New Evidence and Policy Implications," Handbook of Economic Growth,in: Handbook of Economic Growth, edition 1, volume 2, chapter 2, pages 49-120 Elsevier.
    12. Dawes, Christopher T. & Johannesson, Magnus & Lindqvist, Erik & Loewen, Peter & Östling, Robert & Bonde, Marianne & Priks, Frida, 2012. "Generosity and Political Preferences," Working Paper Series 941, Research Institute of Industrial Economics.
    13. James Andreoni & John Miller, 2002. "Giving According to GARP: An Experimental Test of the Consistency of Preferences for Altruism," Econometrica, Econometric Society, vol. 70(2), pages 737-753, March.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. John, Katrin & Thomsen, Stephan L., 2015. "School-track environment or endowment: What determines different other-regarding behavior across peer groups?," Games and Economic Behavior, Elsevier, vol. 94(C), pages 122-141.
    2. Tom Lane, 2015. "Discrimination in the laboratory: a meta-analysis," Discussion Papers 2015-03, The Centre for Decision Research and Experimental Economics, School of Economics, University of Nottingham.

    More about this item

    Keywords

    social preferences; experiment; institutions; market economy; democracy;

    JEL classification:

    • C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior
    • C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments
    • D03 - Microeconomics - - General - - - Behavioral Microeconomics: Underlying Principles
    • P20 - Economic Systems - - Socialist Systems and Transition Economies - - - General

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:iza:izadps:dp7567. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Mark Fallak). General contact details of provider: http://www.iza.org .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.