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Efficiency-Morality Trade-Offs in Repugnant Transactions: A Choice Experiment

Author

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  • Elias, Julio

    (Universidad del CEMA)

  • Lacetera, Nicola

    (University of Toronto)

  • Macis, Mario

    (The Johns Hopkins Carey Business School)

Abstract

Societies prohibit many transactions considered morally repugnant, although potentially efficiency-enhancing. We conducted an online choice experiment to characterize preferences for the morality and efficiency of payments to kidney donors. Preferences were heterogeneous, ranging from deontological to strongly consequentialist; the median respondent would support payments by a public agency if they increased the annual kidney supply by six percentage points, and private transactions for a thirty percentage-point increase. Fairness concerns drive this difference. Our findings suggest that cost-benefit considerations affect the acceptance of morally controversial transactions, and imply that trial studies of the effects of payments would inform the public debate.

Suggested Citation

  • Elias, Julio & Lacetera, Nicola & Macis, Mario, 2016. "Efficiency-Morality Trade-Offs in Repugnant Transactions: A Choice Experiment," IZA Discussion Papers 10187, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp10187
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    Cited by:

    1. Benabou, Roland & Falk, Armin & Tirole, Jean, 2018. "Narratives, Imperatives, and Moral Reasoning," IZA Discussion Papers 11665, Institute of Labor Economics (IZA).
    2. Leonardo Bursztyn & Stefano Fiorin & Daniel Gottlieb & Martin Kanz, 2019. "Moral Incentives in Credit Card Debt Repayment: Evidence from a Field Experiment," Journal of Political Economy, University of Chicago Press, vol. 127(4), pages 1641-1683.
    3. Julio J. Elías & Nicola Lacetera & Mario Macis & Paola Salardi, 2017. "Economic Development and the Regulation of Morally Contentious Activities," American Economic Review, American Economic Association, vol. 107(5), pages 76-80, May.
    4. Nicola Lacetera, 2016. "Incentives and Ethics in the Economics of Body Parts," NBER Working Papers 22673, National Bureau of Economic Research, Inc.
    5. Leonardo Bursztyn & Georgy Egorov & Stefano Fiorin, 2017. "From Extreme to Mainstream: How Social Norms Unravel," NBER Working Papers 23415, National Bureau of Economic Research, Inc.
    6. Julio Elias & Nicola Lacetera & Mario Macis, 2017. "Understanding repugnance: Implications for public policy," CEMA Working Papers: Serie Documentos de Trabajo. 614, Universidad del CEMA.
    7. Christina Leuker & Lasare Samartzidis & Ralph Hertwig & Timothy J Pleskac, 2020. "When money talks: Judging risk and coercion in high-paying clinical trials," PLOS ONE, Public Library of Science, vol. 15(1), pages 1-15, January.
    8. Chatterjee, Subimal & Dalman, M. Deniz & Mookherjee, Satadruta, 2020. "To short or not to short? Improving morality judgments of short trades and short traders," Journal of Business Research, Elsevier, vol. 114(C), pages 173-185.

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    More about this item

    Keywords

    repugnant transactions; efficiency; morality; markets; preferences;
    All these keywords.

    JEL classification:

    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • D01 - Microeconomics - - General - - - Microeconomic Behavior: Underlying Principles
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • D64 - Microeconomics - - Welfare Economics - - - Altruism; Philanthropy; Intergenerational Transfers
    • I11 - Health, Education, and Welfare - - Health - - - Analysis of Health Care Markets

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