This paper incorporates compassion into social preferences and tracks individuals’ choices over ten allocation decisions, categorizing participants’ behavior more precisely than previous work. Approximately two-thirds of participants exhibit consistent preferences in all ten exercises and other-regarding individuals are almost evenly split between inequity aversion and social surplus maximizati...

Children’s sense and reasoning about territory and land ownership may develop differently in contexts of poverty and where narratives of dispossession are a part of daily life and are of political and historical significance, as is the case in the Palestinian refugee context in Lebanon. In this study we looked at how 3and 5-year-old refugee Palestinian and American children distribute land amon...

This paper reports experimental evidence from a Dictator Game experiment in which subjects choose repeatedly one out of four options involving a pair of fixed monetary prizes, one for them, one for another anonymously matched subject. In some sessions, player position (i.e. the identity of the best paid agent, constant across all options) is known in advance before subjects have to make their d...

The Pareto principle is often viewed as a mild requirement compatible with a variety of value judgements. In particular, it is generally thought that it can accommodate different views on the desirable degree of equality. We show that this is generally not true in intertemporal models where some uncertainty prevails. To do so, we formalize the concept of inequality aversion. We show that differ...

The indirect evolutionary approach integrates forward-looking evaluation of opportunities and adaptation in the light of the past. Subjective motivation determines behavior, but long-run evolutionary success of motivational types depends on objective factors only. This can justify intrinsic aversion to inequality in reward allocation games, though earlier analysis has typically been restricted ...

This paper argues that a generalized model of social preferences must simultaneously pass two tests; the Variety Test (explain outcomes under variety, the V-test) and the Psychological Test (conform to psychological intuition, the P-test). It is shown that none of the models proposed to date unconditionally passes these tests. The paper extends the Fehr and Schmidt model of inequality-aversion ...

This article investigates the properties, good and bad, of social evaluations based on four money measures of well-being or changes in well-being: compensating variations, money metrics, extended money metrics, and welfare ratios. Consistency of social rankings (transitivity, asymmetry of preference), the possibility of incorporating inequality aversion, independence of the choice of reference ...

This article reports the results of a simple bargaining experiment on the ultimatumrevenge game. The game enables to differentiate between fairness that is stimulated by intentional based motives, distributional motives, and fairness considerations that mix both motives. The laboratory experiments indicate considerable heterogeneity of motives. A majority of subjects seem to combine both motive...

This paper considers the macroeconomic implications of a set of empirical studies finding a high degree of dispersion in preference heterogeneity. It develops a model with both uninsurable idiosyncratic income risk and risk aversion heterogeneity to quantify their effects on wealth inequality. The results show that with the available estimates of the risk aversion distribution from PSID data th...

Inequity aversion models have dominated the behavioral economics landscape in the last decade. This study uses variants of dictator and trust games to provide empirical content to these models. We manipulate market features—such as competition over resources—to demonstrate that extant models cannot explain realistic manipulations of either game. For example, we show that if socially acceptable ...