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Social Norm and Giving with Indivisibility of Money: An Experiment on Selfishness, Equity, and Generosity

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  • Te Bao
  • Xiaohua Yu

Abstract

We study a dictator game considering selfishness, equity, and generosity. The dictators first indicate their willingness to give on a decision form and then allocate 10 yuan cash to the receiver in an envelope. The cash consists of 10 banknotes of1 yuan in treatment 1 (high divisibility) and 2 banknotes of 5 yuan in treatment 2(low divisibility). Treatment 2 only has three choices of giving .0;5;10/.30%of individuals take ceilings or floors rather than the standard rounding in treatment 2. However, the individual roundup and rounddown behaviors cancel each other at the aggregate level.

Suggested Citation

  • Te Bao & Xiaohua Yu, 2019. "Social Norm and Giving with Indivisibility of Money: An Experiment on Selfishness, Equity, and Generosity," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 175(2), pages 272-290.
    • Handle: RePEc:mhr:jinste:urn:doi:10.1628/jite-2019-0020
    DOI: 10.1628/jite-2019-0020
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    More about this item

    Keywords

    dictator game; social norm; divisibility of money; selfishness; equity; generosity;
    All these keywords.

    JEL classification:

    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • D03 - Microeconomics - - General - - - Behavioral Microeconomics: Underlying Principles
    • E03 - Macroeconomics and Monetary Economics - - General - - - Behavioral Macroeconomics
    • M59 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Other

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