Arbeitspapier

The anatomy of distributional preferences with group identity

This paper dissects distributional preferences with group identity in a modified dictator game. I estimate individual-level utility functions with two parameters that govern the trade-offs between equity and efficiency and giving to self and to other. Subjects put on average less weight on income of the out-group, but overall only a minority behaves completely selfishly. Giving to the out-group also renders subjects more accepting of inequality. However, the experiment also uncovers a large heterogeneity of preferences. It seems that those who are social become slightly less social in the presence of the out-group. The number of selfish individuals is instead hardly affected. Moreover, choices in both treatments overwhelmingly stem from well-behaved, yet systematically different underlying social preference functionals. Hence this experiment suggests that the rational choice approach, which is predominantly used in the literature, is a useful tool to understand the effect of group identity on social preferences. As a side result, I find that the weight on self, but not the individual equity-efficiency trade-off predicts political left-right self-assessment as more conservative voters are more selfish. I also document gender differences: females put less weight on self, are more inequality averse and react more strongly to the treatment.

Language
Englisch

Bibliographic citation
Series: Working Papers in Economics and Statistics ; No. 2017-02

Classification
Wirtschaft
Distribution: General
Equity, Justice, Inequality, and Other Normative Criteria and Measurement
National Government Expenditures and Related Policies: General
Subject
social identity
GARP
distributional preferences

Event
Geistige Schöpfung
(who)
Muller, Daniel
Event
Veröffentlichung
(who)
University of Innsbruck, Research Platform Empirical and Experimental Economics (eeecon)
(where)
Innsbruck
(when)
2017

Handle
Last update
10.03.2025, 11:43 AM CET

Data provider

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Object type

  • Arbeitspapier

Associated

  • Muller, Daniel
  • University of Innsbruck, Research Platform Empirical and Experimental Economics (eeecon)

Time of origin

  • 2017

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