Search results for: Keyword=D63 [9]

2017
At the Mercy of a Prisoner. Three Dictator Experiments
Applied Economics Letters
24
774-778
2017
Abstract
We test male juvenile prisoners on a dictator game with another anonymous co-prisoner as recipient. Prisoners give more than students, but less than nonstudents of their age. They give more to a charity than to another prisoner. In one of two experiments, those convicted for violent crime give more than those convicted for property crime.
How to Protect Entitlements: An Experiment
2017/05
Max Planck Institute for Research on Collective Goods
Bonn
2017
Abstract
In a full-information, zero transactions costs world, the degree of protection afforded to an entitlement does not affect the likelihood of efficient trade. In reality, imperfect information is often inevitable. Specifically, a party will usually have incomplete information about fairness norms held by the other party – fairness norms that affect the other party’s willingness to pay (WTP) or willingness to accept (WTA). Importantly, these fairness norms may depend on how strongly the entitlement is protected. We experimentally test the effect of the degree of protection on the parties’ WTP and WTA and on the likelihood of efficient trade by varying the legal remedy for infringing upon the owner’s entitlement. We show that our participants can be divided into three groups corresponding to three different fairness norms: negative types whose WTP and WTA are decreasing in the strength of the legal remedy; positive types whose WTP and WTA are increasing in the strength of the legal remedy; and flat types whose WTP and WTA do not depend on the strength of the legal remedy. We find that type is role-dependent, such that a higher WTP and a lower WTA – the combination most conducive to efficient trade – is obtained with a weaker legal remedy.
People Are Conditional Rule Followers
2017/09
Max Planck Institute for Research on Collective Goods
Bonn
2017
Abstract
Experimental participants are more likely to follow an arbitrary rule the more of their peers do so as well. The difference between unconditional and conditional rule following is most pronounced for individuals who follow few rules unconditionally.
2016
The Solidarity Motive
2016/14
Max Planck Institute for Research on Collective Goods
Bonn
2016
Abstract
For decades, experimental economics has been very interested in behavior that could be characterized as practicing solidarity (although the term is rarely used). Solidarity is a key concept in Catholic Social Teaching. This paper builds a bridge between these two endeavors that, thus far, had little contact with each other. Catholic Social Teaching is essentially normative. People are informed what they should do if they are good Christians. Experimental Economics is descriptive. Experimenters want to learn how much solidarity experimental participants exhibit when this is costly. But from a Catholic perspective it is interesting how strongly their norms are reflected in actual behavior. The many distinctions uncovered by behavioral economics may also help refine Catholic thinking. And behavioral economics is confronted with new questions, in particular regarding deontological motives.
You Are In Charge – Experimentally Testing the Motivating Power of Holding a Judicial Office
2016/15
Max Planck Institute for Research on Collective Goods, Bonn
Bonn
2016
Abstract
Apparently judges’ decisions are not motivated by maximizing their own profit. The literature uses two strategies to explain this observation: judges care about the long-term monetary consequences for themselves, or individuals who are more strongly motivated by the common good self-select into the profession. We suggest that there is an additional explanation, the "office motive". In a lab experiment, we rule out both traditional explanations by design. Nonetheless authorities do a reliable job at overcoming a social dilemma. Calling the authorities "public official" or "judge" increases their sensitivity towards the degree by which individuals are selfish, and it reduces the effect of their social value orientation (making them more neutral). This suggests that the socially desirable effect is not driven by anger or sympathy with the victims, but follows from the desire to fulfill the expectations that come with the assigned task. We test three extensions: When given an opportunity to announce an explicit policy, judges become less sensitive to the objective degree of reproach, and more sensitive to their social value orientation. If judges are elected or experienced, they react more intensely to norm violations. Experienced judges are more affected by their social value orientation.
2014
The values of ex-ante and ex-post communication in dictator games
2014/07
Max Planck Institute for Research on Collective Goods
Bonn
2014
Abstract
In the dictator game, the recipient’s opportunity to send a message to the dictator increases giving. This paper reports two experiments which study how the timing of messages affects dictators’ decisions (experiment 1) and which value recipients attach to communication opportunities (experiment 2). The first experiment shows that the effect of communication on dictator giving is equally strong when the recipient can send a message before or after the dictator has decided. However, recipients in a second experiment reveal a strong preference for pre-decision messages: Their willingness to pay for pre-decision messages is higher than for post-decision messages.
2007
A Contribution to the Theory of Optimal Utilitarian Income Taxation
2007/02
Max Planck Institute for Research on Collective Goods
Bonn
2007
Abstract

The paper provides a new formulation of the Mirrlees-Seade theorem on the positivity of the optimal marginal income tax, under weaker assumptions and in a more general model. The formulation of the theorem is independent of whether the model involves finitely many types or a continuous type distribution. The formal argument makes the underlying logic transparent, relating the mathematics to the economics and showing precisely how each assumption enters the analysis.

The (de)composition of firms: Interdependent preferences of corporate actors
2007/21
Max Planck Institute for Research on Collective Goods
Bonn
2007
Abstract
This article discusses the limitations of the orthodox economic theory of the firm as a nexus of contracts. Various experimental studies have shown that the aggregation of individuals in groups changes behavior and preferences systematically. This perspective has been formalized by models of interdependent preferences. Based on a prominent approach of interdependent preferences, intention-based preferences, two types of labor contracts, incentive contracts and bonus contracts, are analyzed. Results are compared with the predictions of the orthodox economic theory.