[go: up one dir, main page]
IDEAS home Printed from https://ideas.repec.org/p/kud/kuiedp/1906.html
   My bibliography  Save this paper

Distributional Preferences Explain Individual Behavior Across Games and Time

Author

Listed:
  • Morten Hedegaard

    (Department of Economics, University of Copenhagen, Denmark)

  • Rudolf Kerschbamer

    (University of Innsbruck, Austria)

  • Daniel Müler

    (University of Innsbruck, Austria)

  • Jean-Robert Tyran

    (Department of Economics, University of Copenhagen, Denmark)

Abstract
We use a large and heterogeneous sample of the Danish population to investigate the importance of distributional preferences for behavior in a public good game and a trust game. We find robust evidence for the significant explanatory power of distributional preferences. In fact, compared to twenty-one covariates, distributional preferences turn out to be the single most important predictor of behavior. Specifically, subjects who reveal benevolence in the domain of advantageous inequality contribute more to the public good and are more likely to pick the trustworthy action in the trust game than other subjects. Since the experiments were spread out more than one year, our results suggest that there is a component of distributional preferences that is stable across games and over time.

Suggested Citation

  • Morten Hedegaard & Rudolf Kerschbamer & Daniel Müler & Jean-Robert Tyran, 2019. "Distributional Preferences Explain Individual Behavior Across Games and Time," Discussion Papers 19-06, University of Copenhagen. Department of Economics.
    • Handle: RePEc:kud:kuiedp:1906
    as

    Download full text from publisher

    File URL: https://www.economics.ku.dk/research/publications/wp/dp_2019/1906.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Loukas Balafoutas & Rudolf Kerschbamer & Matthias Sutter, 2017. "Second‐Degree Moral Hazard In A Real‐World Credence Goods Market," Economic Journal, Royal Economic Society, vol. 127(599), pages 1-18, February.
    2. Krawczyk, Michal & Le Lec, Fabrice, 2021. "How to elicit distributional preferences: A stress-test of the equality equivalence test," Journal of Economic Behavior & Organization, Elsevier, vol. 182(C), pages 13-28.
    3. 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.
    4. Ernst Fehr & Klaus M. Schmidt, 1999. "A Theory of Fairness, Competition, and Cooperation," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 114(3), pages 817-868.
    5. Ernst Fehr & Michael Naef & Klaus M. Schmidt, 2006. "Inequality Aversion, Efficiency, and Maximin Preferences in Simple Distribution Experiments: Comment," American Economic Review, American Economic Association, vol. 96(5), pages 1912-1917, December.
    6. Harbaugh, William T & Krause, Kate, 2000. "Children's Altruism in Public Good and Dictator Experiments," Economic Inquiry, Western Economic Association International, vol. 38(1), pages 95-109, January.
    7. John A. List, 2007. "On the Interpretation of Giving in Dictator Games," Journal of Political Economy, University of Chicago Press, vol. 115(3), pages 482-493.
    8. Kerschbamer, Rudolf & Müller, Daniel, 2020. "Social preferences and political attitudes: An online experiment on a large heterogeneous sample," Journal of Public Economics, Elsevier, vol. 182(C).
    9. Thöni, Christian & Tyran, Jean-Robert & Wengström, Erik, 2012. "Microfoundations of social capital," Journal of Public Economics, Elsevier, vol. 96(7-8), pages 635-643.
    10. Ola Andersson & Håkan J. Holm & Jean-Robert Tyran & Erik Wengström, 2016. "Risk Aversion Relates to Cognitive Ability: Preferences Or Noise?," Journal of the European Economic Association, European Economic Association, vol. 14(5), pages 1129-1154.
    11. Paetzel, Fabian & Sausgruber, Rupert & Traub, Stefan, 2014. "Social preferences and voting on reform: An experimental study," European Economic Review, Elsevier, vol. 70(C), pages 36-55.
    12. Dannenberg, Astrid & Riechmann, Thomas & Sturm, Bodo & Vogt, Carsten, 2007. "Inequity Aversion and Individual Behavior in Public Good Games: An Experimental Investigation," ZEW Discussion Papers 07-034, ZEW - Leibniz Centre for European Economic Research.
    13. Pablo Hernandez-Lagos & Dylan Minor & Dana Sisak, 2017. "Do people who care about others cooperate more? Experimental evidence from relative incentive pay," Experimental Economics, Springer;Economic Science Association, vol. 20(4), pages 809-835, December.
    14. Adrian Bruhin & Ernst Fehr & Daniel Schunk, 2019. "The many Faces of Human Sociality: Uncovering the Distribution and Stability of Social Preferences," Journal of the European Economic Association, European Economic Association, vol. 17(4), pages 1025-1069.
    15. repec:cup:judgdm:v:6:y:2011:i:8:p:771-781 is not listed on IDEAS
    16. Kamas, Linda & Preston, Anne, 2015. "Can social preferences explain gender differences in economic behavior?," Journal of Economic Behavior & Organization, Elsevier, vol. 116(C), pages 525-539.
    17. Dirk Engelmann & Martin Strobel, 2006. "Inequality Aversion, Efficiency, and Maximin Preferences in Simple Distribution Experiments: Reply," American Economic Review, American Economic Association, vol. 96(5), pages 1918-1923, December.
    18. Ernst Fehr & Urs Fischbacher, "undated". "Why Social Preferences Matter - The Impact of Non-Selfish Motives on Competition," IEW - Working Papers 084, Institute for Empirical Research in Economics - University of Zurich.
    19. Fosgaard, Toke R. & Hansen, Lars G. & Wengström, Erik, 2019. "Cooperation, framing, and political attitudes," Journal of Economic Behavior & Organization, Elsevier, vol. 158(C), pages 416-427.
    20. Abbink, Klaus & Irlenbusch, Bernd & Renner, Elke, 2000. "The moonlighting game: An experimental study on reciprocity and retribution," Journal of Economic Behavior & Organization, Elsevier, vol. 42(2), pages 265-277, June.
    21. Balafoutas, Loukas & Kerschbamer, Rudolf & Sutter, Matthias, 2012. "Distributional preferences and competitive behavior," Journal of Economic Behavior & Organization, Elsevier, vol. 83(1), pages 125-135.
    22. Charles A. Holt & Susan K. Laury, 2002. "Risk Aversion and Incentive Effects," American Economic Review, American Economic Association, vol. 92(5), pages 1644-1655, December.
    23. Blanco, Mariana & Engelmann, Dirk & Normann, Hans Theo, 2011. "A within-subject analysis of other-regarding preferences," Games and Economic Behavior, Elsevier, vol. 72(2), pages 321-338, June.
    24. Axel Ockenfels & Gary E. Bolton, 2000. "ERC: A Theory of Equity, Reciprocity, and Competition," American Economic Review, American Economic Association, vol. 90(1), pages 166-193, March.
    25. Yang, Yang & Onderstal, Sander & Schram, Arthur, 2016. "Inequity aversion revisited," Journal of Economic Psychology, Elsevier, vol. 54(C), pages 1-16.
    26. Kritikos, Alexander & Bolle, Friedel, 2001. "Distributional concerns: equity- or efficiency-oriented?," Economics Letters, Elsevier, vol. 73(3), pages 333-338, December.
    27. Kerschbamer, Rudolf & Neururer, Daniel & Gruber, Alexander, 2019. "Do altruists lie less?," Journal of Economic Behavior & Organization, Elsevier, vol. 157(C), pages 560-579.
      • Rudolf Kerschbamer & Daniel Neururer & Alexander Gruber, 2017. "Do the altruists lie less?," Working Papers 2017-18, Faculty of Economics and Statistics, Universität Innsbruck, revised 09 Nov 2017.
    28. Tyran, Jean-Robert & Sausgruber, Rupert, 2006. "A little fairness may induce a lot of redistribution in democracy," European Economic Review, Elsevier, vol. 50(2), pages 469-485, February.
    29. Sabrina Teyssier, 2012. "Inequity and risk aversion in sequential public good games," Public Choice, Springer, vol. 151(1), pages 91-119, April.
    30. Dirk Engelmann & Martin Strobel, 2010. "Inequality Aversion and Reciprocity in Moonlighting Games," Games, MDPI, vol. 1(4), pages 1-19, October.
    31. repec:cup:judgdm:v:13:y:2018:i:1:p:99-111 is not listed on IDEAS
    32. Derin-Güre, Pinar & Uler, Neslihan, 2010. "Charitable giving under inequality aversion," Economics Letters, Elsevier, vol. 107(2), pages 208-210, May.
    33. Dirk Engelmann & Martin Strobel, 2004. "Inequality Aversion, Efficiency, and Maximin Preferences in Simple Distribution Experiments," American Economic Review, American Economic Association, vol. 94(4), pages 857-869, September.
    34. Cappelen, Alexander W. & Nielsen, Ulrik H. & Sørensen, Erik Ø. & Tungodden, Bertil & Tyran, Jean-Robert, 2013. "Give and take in dictator games," Economics Letters, Elsevier, vol. 118(2), pages 280-283.
    35. Dreber, Anna & Fudenberg, Drew & Rand, David G., 2014. "Who cooperates in repeated games: The role of altruism, inequity aversion, and demographics," Journal of Economic Behavior & Organization, Elsevier, vol. 98(C), pages 41-55.
    36. Adrian Bruhin & Ernst Fehr & Daniel Schunk, 2019. "Correction to: The Many Faces of Human Sociality: Uncovering the Distribution and Stability of Social Preferences," Journal of the European Economic Association, European Economic Association, vol. 17(4), pages 1335-1335.
    37. Kamas, Linda & Preston, Anne, 2012. "Distributive and reciprocal fairness: What can we learn from the heterogeneity of social preferences?," Journal of Economic Psychology, Elsevier, vol. 33(3), pages 538-553.
    38. Simon Gächter & Daniele Nosenzo & Martin Sefton, 2013. "Peer Effects In Pro-Social Behavior: Social Norms Or Social Preferences?," Journal of the European Economic Association, European Economic Association, vol. 11(3), pages 548-573, June.
    39. Arnaud De Bruyn & Gary E. Bolton, 2008. "Estimating the Influence of Fairness on Bargaining Behavior," Management Science, INFORMS, vol. 54(10), pages 1774-1791, October.
    40. Shane Frederick, 2005. "Cognitive Reflection and Decision Making," Journal of Economic Perspectives, American Economic Association, vol. 19(4), pages 25-42, Fall.
    41. Blanco, Mariana & Engelmann, Dirk & Koch, Alexander K. & Normann, Hans-Theo, 2014. "Preferences and beliefs in a sequential social dilemma: a within-subjects analysis," Games and Economic Behavior, Elsevier, vol. 87(C), pages 122-135.
    42. Loukas Balafoutas & Rudolf Kerschbamer & Matthias Sutter, 2017. "Second‐Degree Moral Hazard In A Real‐World Credence Goods Market," Economic Journal, Royal Economic Society, vol. 127(599), pages 1-18, February.
    43. Höchtl, Wolfgang & Sausgruber, Rupert & Tyran, Jean-Robert, 2012. "Inequality aversion and voting on redistribution," European Economic Review, Elsevier, vol. 56(7), pages 1406-1421.
    44. Fisman, Raymond & Jakiela, Pamela & Kariv, Shachar, 2017. "Distributional preferences and political behavior," Journal of Public Economics, Elsevier, vol. 155(C), pages 1-10.
    45. Håkan J. Holm & Anders Danielson, 2005. "Tropic Trust Versus Nordic Trust: Experimental Evidence From Tanzania And Sweden," Economic Journal, Royal Economic Society, vol. 115(503), pages 505-532, April.
    46. Offerman, Theo & Sonnemans, Joep & Schram, Arthur, 1996. "Value Orientations, Expectations and Voluntary Contributions in Public Goods," Economic Journal, Royal Economic Society, vol. 106(437), pages 817-845, July.
    47. Nicholas Bardsley, 2008. "Dictator game giving: altruism or artefact?," Experimental Economics, Springer;Economic Science Association, vol. 11(2), pages 122-133, June.
    48. Kerschbamer, Rudolf, 2015. "The geometry of distributional preferences and a non-parametric identification approach: The Equality Equivalence Test," European Economic Review, Elsevier, vol. 76(C), pages 85-103.
    49. Ernst Fehr & Urs Fischbacher, 2002. "Why Social Preferences Matter -- The Impact of Non-Selfish Motives on Competition, Cooperation and Incentives," Economic Journal, Royal Economic Society, vol. 112(478), pages 1-33, March.
    50. Steven D. Levitt & John A. List, 2007. "What Do Laboratory Experiments Measuring Social Preferences Reveal About the Real World?," Journal of Economic Perspectives, American Economic Association, vol. 21(2), pages 153-174, Spring.
    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. Ola Andersson & Håkan J. Holm & Jean-Robert Tyran & Erik Wengström, 2020. "Robust inference in risk elicitation tasks," Journal of Risk and Uncertainty, Springer, vol. 61(3), pages 195-209, December.
    2. Fehr, Dietmar & Müller, Daniel & Preuss, Marcel, 2024. "Social mobility perceptions and inequality acceptance," Journal of Economic Behavior & Organization, Elsevier, vol. 221(C), pages 366-384.
    3. Thomas Epper & Julien Senn & Ernst Fehr, 2023. "Social preferences across subject pools: students vs. general population," ECON - Working Papers 435, Department of Economics - University of Zurich, revised Jan 2024.
    4. Reindl, Ilona & Tyran, Jean-Robert, 2021. "Equal opportunities for all? How income redistribution promotes support for economic inclusion," Journal of Economic Behavior & Organization, Elsevier, vol. 190(C), pages 390-407.
    5. Malte Baader & Simon Gaechter & Kyeongtae Lee & Martin Sefton, 2022. "Social preferences and the variability of conditional cooperation," Discussion Papers 2022-13, The Centre for Decision Research and Experimental Economics, School of Economics, University of Nottingham.
    6. Müller, Daniel, 2019. "The anatomy of distributional preferences with group identity," Journal of Economic Behavior & Organization, Elsevier, vol. 166(C), pages 785-807.

    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. Kerschbamer, Rudolf & Müller, Daniel, 2020. "Social preferences and political attitudes: An online experiment on a large heterogeneous sample," Journal of Public Economics, Elsevier, vol. 182(C).
    2. Fehr, Dietmar & Müller, Daniel & Preuss, Marcel, 2024. "Social mobility perceptions and inequality acceptance," Journal of Economic Behavior & Organization, Elsevier, vol. 221(C), pages 366-384.
    3. Adrian Bruhin & Ernst Fehr & Daniel Schunk, 2019. "The many Faces of Human Sociality: Uncovering the Distribution and Stability of Social Preferences," Journal of the European Economic Association, European Economic Association, vol. 17(4), pages 1025-1069.
    4. Kerschbamer, Rudolf, 2015. "The geometry of distributional preferences and a non-parametric identification approach: The Equality Equivalence Test," European Economic Review, Elsevier, vol. 76(C), pages 85-103.
    5. Rudolf Kerschbamer, 2013. "The Geometry of Distributional Preferences and a Non-Parametric Identification Approach," Working Papers 2013-25, Faculty of Economics and Statistics, Universität Innsbruck.
    6. Cabeza Martínez, Begoña, 2023. "Social preferences, support for redistribution, and attitudes towards vulnerable groups," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 107(C).
    7. He, Haoran & Wu, Keyu, 2016. "Choice set, relative income, and inequity aversion: An experimental investigation," Journal of Economic Psychology, Elsevier, vol. 54(C), pages 177-193.
    8. Krawczyk, Michal & Le Lec, Fabrice, 2021. "How to elicit distributional preferences: A stress-test of the equality equivalence test," Journal of Economic Behavior & Organization, Elsevier, vol. 182(C), pages 13-28.
    9. Yang, Yang & Onderstal, Sander & Schram, Arthur, 2016. "Inequity aversion revisited," Journal of Economic Psychology, Elsevier, vol. 54(C), pages 1-16.
    10. Müller, Stephan & Rau, Holger A., 2019. "Decisions under uncertainty in social contexts," Games and Economic Behavior, Elsevier, vol. 116(C), pages 73-95.
    11. Yonas Alem & Martin G. Kocher & Simon Schürz & Fredrik Carlsson & Mikael Lindahl, 2023. "Distributional preferences in adolescent peer networks," Experimental Economics, Springer;Economic Science Association, vol. 26(1), pages 223-248, March.
    12. Werner Güth & M. Levati & Matteo Ploner, 2012. "An experimental study of the generosity game," Theory and Decision, Springer, vol. 72(1), pages 51-63, January.
    13. Blanco, Mariana & Engelmann, Dirk & Normann, Hans Theo, 2011. "A within-subject analysis of other-regarding preferences," Games and Economic Behavior, Elsevier, vol. 72(2), pages 321-338, June.
    14. Begoña Cabeza;, 2023. "Social preferences, support for redistribution, and attitudes towards vulnerable groups," Working Papers 2308, Herman Deleeck Centre for Social Policy, University of Antwerp.
    15. Gago, Andrés, 2021. "Reciprocity and uncertainty: When do people forgive?," Journal of Economic Psychology, Elsevier, vol. 84(C).
    16. Martin G. Kocher & Odile Poulsen & Daniel J. Zizzo, 2017. "Social preferences, accountability, and wage bargaining," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 48(3), pages 659-678, March.
    17. Kamas, Linda & Preston, Anne, 2015. "Can social preferences explain gender differences in economic behavior?," Journal of Economic Behavior & Organization, Elsevier, vol. 116(C), pages 525-539.
    18. Carlos Alós-Ferrer & Jaume García-Segarra & Alexander Ritschel, 2018. "The Big Robber Game," ECON - Working Papers 291, Department of Economics - University of Zurich.
    19. Breitmoser, Yves & Vorjohann, Pauline, 2022. "Fairness-based Altruism," Center for Mathematical Economics Working Papers 666, Center for Mathematical Economics, Bielefeld University.
    20. Lacomba, Juan A. & Lagos, Francisco & Reuben, Ernesto & van Winden, Frans, 2017. "Decisiveness, peace, and inequality in games of conflict," Journal of Economic Psychology, Elsevier, vol. 63(C), pages 216-229.

    More about this item

    Keywords

    Distributional preferences; social preferences; Equality-Equivalence Test; representative online experiment; trust game; public goods game; dictator game;
    All these keywords.

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • D64 - Microeconomics - - Welfare Economics - - - Altruism; Philanthropy; Intergenerational Transfers

    NEP fields

    This paper has been announced in the following NEP Reports:

    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:kud:kuiedp:1906. 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: Thomas Hoffmann (email available below). General contact details of provider: https://edirc.repec.org/data/okokudk.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.