Inequality Aversion, Efficiency, and Maximin Preferences in Simple Distribution Experiments
Top Cited Papers
- 1 September 2004
- journal article
- Published by American Economic Association in American Economic Review
- Vol. 94 (4) , 857-869
- https://doi.org/10.1257/0002828042002741
Abstract
We present simple one-shot distribution experiments comparing the relative importance of efficiency concerns, maximin preferences, and inequality aversion, as well as the relative performance of the fairness theories by Gary E Bolton and Axel Ockenfels and by Ernst Fehr and Klaus M. Schmidt. While the Fehr-Schmidt theory performs better in a direct comparison, this appears to be due to being in line with maximin preferences. More importantly, we find that a combination of efficiency concerns, maximin preferences, and selfishness can rationalize most of the data while the Bolton-Ockenfels and Fehr-Schmidt theories are unable to explain important patterns.Keywords
This publication has 18 references indexed in Scilit:
- Giving According to GARP: An Experimental Test of the Consistency of Preferences for AltruismEconometrica, 2002
- Tests of fairness models based on equity considerations in a three-person ultimatum gameExperimental Economics, 2001
- Distributional concerns: equity- or efficiency-oriented?Economics Letters, 2001
- ERC: A Theory of Equity, Reciprocity, and CompetitionAmerican Economic Review, 2000
- Working with paperPublished by Elsevier ,2000
- Informal SanctionsSSRN Electronic Journal, 2000
- A Theory of Fairness, Competition, and CooperationThe Quarterly Journal of Economics, 1999
- Decisions, Error and HeterogeneityThe Economic Journal, 1997
- When Social Outcomes Aren′t Fair: The Effect of Causal Attributions on PreferencesOrganizational Behavior and Human Decision Processes, 1995
- Trust, Reciprocity, and Social HistoryGames and Economic Behavior, 1995