IDEAS home Printed from https://ideas.repec.org/p/zbw/bonedp/292004.html
   My bibliography  Save this paper

Equitable Allocations in Experimental Bargaining Games: Inequality A version versus Efficiency

Author

Listed:
  • Herreiner, Dorothea K.
  • Puppe, Clemens

Abstract

In this paper, we report on a series of free-form bargaining experiments in which two players have to distribute four indivisible goods among themselves. In one treatment the monetary payoffs associated with each bundle of goods are common knowledge; in a second treatment only the ordinal ranking of the bundles is given. We find that in both cases, the following qualitative rule yields a good explanation of individual behavior: First determine the most equal distribution, then find a Pareto improvement provided that this does not create “too much” inequality. In the ordinal treatment, individuals apparently use the ranks in the respective preference orderings over bundles as a substitute for the unknown monetary value. Interestingly, we find much less Pareto-damaging behavior due to inequality aversion in the ordinal treatment.

Suggested Citation

  • Herreiner, Dorothea K. & Puppe, Clemens, 2004. "Equitable Allocations in Experimental Bargaining Games: Inequality A version versus Efficiency," Bonn Econ Discussion Papers 29/2004, University of Bonn, Bonn Graduate School of Economics (BGSE).
    • Handle: RePEc:zbw:bonedp:292004
    as

    Download full text from publisher

    File URL: https://www.econstor.eu/bitstream/10419/22906/1/bgse29_2004.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Gary Charness & Matthew Rabin, 2002. "Understanding Social Preferences with Simple Tests," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 117(3), pages 817-869.
    2. Kritikos, Alexander & Bolle, Friedel, 2001. "Distributional concerns: equity- or efficiency-oriented?," Economics Letters, Elsevier, vol. 73(3), pages 333-338, December.
    3. Herreiner, Dorothea K. & Puppe, Clemens, 2004. "Envy Freeness in Experimental Fair Division Problems," Bonn Econ Discussion Papers 28/2004, University of Bonn, Bonn Graduate School of Economics (BGSE).
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Colin F. Camerer & Gideon Nave & Alec Smith, 2019. "Dynamic Unstructured Bargaining with Private Information: Theory, Experiment, and Outcome Prediction via Machine Learning," Management Science, INFORMS, vol. 65(4), pages 1867-1890, April.
    2. Herreiner, Dorothea K. & Puppe, Clemens, 2004. "Envy Freeness in Experimental Fair Division Problems," Bonn Econ Discussion Papers 28/2004, University of Bonn, Bonn Graduate School of Economics (BGSE).
    3. Chmura, Thorsten & Kube, Sebastian & Pitz, Thomas & Puppe, Clemens, 2005. "Testing (beliefs about) social preferences: Evidence from an experimental coordination game," Economics Letters, Elsevier, vol. 88(2), pages 214-220, August.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Dirk Engelmann & Martin Strobel, 2007. "Preferences over Income Distributions," Public Finance Review, , vol. 35(2), pages 285-310, March.
    2. Engelmann, Dirk, 2012. "How not to extend models of inequality aversion," Journal of Economic Behavior & Organization, Elsevier, vol. 81(2), pages 599-605.
    3. Nicolas Jacquemet & Adam Zylbersztejn, 2014. "What drives failure to maximize payoffs in the lab? A test of the inequality aversion hypothesis," Review of Economic Design, Springer;Society for Economic Design, vol. 18(4), pages 243-264, December.
    4. Marianna Baggio & Luigi Mittone, 2016. "Experience and History: An Experimental Approach to Generational Heterogeneity," International Journal of Applied Behavioral Economics (IJABE), IGI Global, vol. 5(4), pages 1-23, October.
    5. Hedegaard, Morten & Kerschbamer, Rudolf & Müller, Daniel & Tyran, Jean-Robert, 2021. "Distributional preferences explain individual behavior across games and time," Games and Economic Behavior, Elsevier, vol. 128(C), pages 231-255.
    6. Danz, David & Engelmann, Dirk & Kübler, Dorothea, 2022. "Do legal standards affect ethical concerns of consumers?," European Economic Review, Elsevier, vol. 144(C).
    7. Gary E. Bolton & Axel Ockenfels, 2004. "The Behavioral Tradeoff between Efficiency and Equity when a Majority Rules," Papers on Strategic Interaction 2003-12, Max Planck Institute of Economics, Strategic Interaction Group.
    8. Ori Weisel & Ro'i Zultan, 2013. "Social motives in intergroup conflict," Jena Economics Research Papers 2013-033, Friedrich-Schiller-University Jena.
    9. Friedel Bolle & Yves Breitmoser & Jana Heimel & Claudia Vogel, 2012. "Multiple motives of pro-social behavior: evidence from the solidarity game," Theory and Decision, Springer, vol. 72(3), pages 303-321, March.
    10. Morgenstern, Albrecht, 2004. "Efficiency concerns and incentive provision--an experimental study," Economics Letters, Elsevier, vol. 83(3), pages 335-341, June.
    11. Dinky Daruvala, 2009. "Would The Right Social Preference Model Please Stand Up!," Post-Print hal-00744366, HAL.
    12. Chmura, Thorsten & Kube, Sebastian & Pitz, Thomas & Puppe, Clemens, 2005. "Testing (beliefs about) social preferences: Evidence from an experimental coordination game," Economics Letters, Elsevier, vol. 88(2), pages 214-220, August.
    13. Kritikos, Alexander S. & Tan, Jonathan H. W., 2005. "Indenture as a Commitment Device in Self-Enforced Contracts: An Experimental Test," Discussion Papers 241, European University Viadrina Frankfurt (Oder), Department of Business Administration and Economics.
    14. Kritikos, Alexander S. & Tan, Jonathan H.W., 2016. "Influence in the Face of Impunity," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 141, pages 119-121.
    15. Rodriguez-lara, Ismael, 2015. "Equal distribution or equal payoffs? Reciprocity and inequality aversion in the investment game," MPRA Paper 63313, University Library of Munich, Germany.
    16. repec:uea:wcbess:13-02 is not listed on IDEAS
    17. Staffiero, Gianandrea, 2006. "Helping the meaner, hurting the nicer: The contribution versus distribution game," IESE Research Papers D/652, IESE Business School.
    18. Alexander S. Kritikos & Jonathan H. W. Tan, 2014. "Would I Care if I Knew?: Image Concerns and Social Confirmation in Giving," Discussion Papers of DIW Berlin 1439, DIW Berlin, German Institute for Economic Research.
    19. Faravelli, Marco & Kirchkamp, Oliver & Rainer, Helmut, 2013. "The effect of power imbalances on incentives to make non-contractible investments," European Economic Review, Elsevier, vol. 61(C), pages 169-185.
    20. Cetre, Sophie & Lobeck, Max & Senik, Claudia & Verdier, Thierry, 2019. "Preferences over income distribution: Evidence from a choice experiment," Journal of Economic Psychology, Elsevier, vol. 74(C).
    21. Stephan Kroll & Todd Cherry & Jason Shogren, 2007. "The impact of endowment heterogeneity and origin on contributions in best-shot public good games," Experimental Economics, Springer;Economic Science Association, vol. 10(4), pages 411-428, December.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:zbw:bonedp:292004. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ZBW - Leibniz Information Centre for Economics (email available below). General contact details of provider: https://edirc.repec.org/data/gsbonde.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.