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Effects of gain-loss frames on social preferences

Author

Listed:
  • Kene Boun My
  • Nicolas Lampach
  • Mathieu Lefebvre

Abstract

The paper provides new experimental evidence on the difference between inequality aversion in the gain and in the loss domain. Incorporating loss aversion in the model by Fehr and Schmidt (1999) and relying on a modified dictator game as proposed by Blanco et al. (2011), we demonstrate that the parameter of inequality aversion is lower when the game is framed with losses than with gains. Individuals would be less inequality averse for losses than for gains. The results also manifest that women are more inequality averse than men.

Suggested Citation

  • Kene Boun My & Nicolas Lampach & Mathieu Lefebvre, 2016. "Effects of gain-loss frames on social preferences," Working Papers of BETA 2016-21, Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg.
  • Handle: RePEc:ulp:sbbeta:2016-21
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    File URL: http://www.beta-umr7522.fr/productions/publications/2016/2016-21.pdf
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    References listed on IDEAS

    as
    1. Ernst Fehr & Klaus M. Schmidt, 1999. "A Theory of Fairness, Competition, and Cooperation," The Quarterly Journal of Economics, Oxford University Press, vol. 114(3), pages 817-868.
    2. Tania Singer & Ernst Fehr, 2005. "The Neuroeconomics of Mind Reading and Empathy," American Economic Review, American Economic Association, vol. 95(2), pages 340-345, May.
    3. Battigalli, Pierpaolo & Dufwenberg, Martin, 2009. "Dynamic psychological games," Journal of Economic Theory, Elsevier, vol. 144(1), pages 1-35, January.
    4. Blanco, Mariana & Engelmann, Dirk & Normann, Hans Theo, 2011. "A within-subject analysis of other-regarding preferences," Games and Economic Behavior, Elsevier, vol. 72(2), pages 321-338, June.
    5. Nicolas Lampach & Kene Boun My & Sandrine Spaeter, 2016. "Risk, Ambiguity and Efficient Liability Rules: An experiment," Working Papers of BETA 2016-30, Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg.
    6. René van Bavel & Benedikt Herrmann & Gabriele Esposito & Antonios Proestakis, 2013. "Applying Behavioural Science to EU Policy-Making," JRC Working Papers JRC83284, Joint Research Centre (Seville site).
    7. Heinrich, Timo & Weimann, Joachim, 2013. "A note on reciprocity and modified dictator games," Economics Letters, Elsevier, vol. 121(2), pages 202-205.
    8. 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.
    9. Attanasi, Giuseppe & Boun My, Kene, 2016. "Jeu du dictateur et jeu de la confiance : préférences distributives vs préférences dépendantes des croyances," L'Actualité Economique, Société Canadienne de Science Economique, vol. 92(1-2), pages 249-287, Mars-Juin.
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    More about this item

    Keywords

    social preferences; inequality aversion; modified dictator game; loss aversion; laboratory experiment.;

    JEL classification:

    • C70 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - General
    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement

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