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How institutions shape individual motives for efficiency and equity: Evidence from distribution experiments

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  • Ambec, Stefan
  • Garapin, Alexis
  • Muller, Laurent
  • Rahali, Bilel

Abstract

We investigate how institutions can shape differently the expression for efficiency and equity. We run four variants of the triple dictator game and the trust game in a within-subject design that enables to plot individual patterns. A veil of ignorance, a positional fee and information about others’ behaviors are successively introduced to the two standard games. Alongside those treatments, we also control for individual preferences towards risk and other regarding preferences. Results show that while individuals demonstrate consistency in their preferences, the prospect of transfers in the trust game and the veil of ignorance increases efficiency and equity. Second, the option to choose their position as investor at some cost attracts the less cooperative players: they pay to be investor and keep more for themselves. Third, subjects who modify their investment decision after learning the average investment in their group tend to move closer to the average.

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  • Ambec, Stefan & Garapin, Alexis & Muller, Laurent & Rahali, Bilel, 2019. "How institutions shape individual motives for efficiency and equity: Evidence from distribution experiments," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 81(C), pages 128-138.
    • Handle: RePEc:eee:soceco:v:81:y:2019:i:c:p:128-138
    DOI: 10.1016/j.socec.2019.06.005
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    More about this item

    Keywords

    Trust game; Triple dictator game; Fairness; Efficiency; Social dilemma; Equity;
    All these keywords.

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • C90 - Mathematical and Quantitative Methods - - Design of Experiments - - - General
    • D03 - Microeconomics - - General - - - Behavioral Microeconomics: Underlying Principles
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement

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