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On inequity aversion: A reply to Binmore and Shaked

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  • Fehr, Ernst
  • Schmidt, Klaus M.

Abstract

In this paper we reply to Binmore and Shaked’s criticism of the Fehr-Schmidt model of inequity aversion. We put the theory and their arguments into perspective and show that their criticism is not substantiated. Finally, we briefly comment on the main challenges for future research on social preferences.

Suggested Citation

  • Fehr, Ernst & Schmidt, Klaus M., 2010. "On inequity aversion: A reply to Binmore and Shaked," Munich Reprints in Economics 20653, University of Munich, Department of Economics.
    • Handle: RePEc:lmu:muenar:20653
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    JEL classification:

    • B41 - Schools of Economic Thought and Methodology - - Economic Methodology - - - Economic Methodology
    • C90 - Mathematical and Quantitative Methods - - Design of Experiments - - - General

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