Departures from pure self interest in economic experiments have recently
inspired models of "social preferences". We conduct experiments on
simple two-person and three-person games with binary choices that test
these theories more directly than the array of games conventionally
considered. Our experiments show strong support for the prevalence of
"quasi-maximin" preferences: People sacrifice to increase the payoffs
for all recipients, but especially for the lowest-payoff recipients.
People ...
Departures from pure self interest in economic experiments have recently
inspired models of "social preferences". We conduct experiments on
simple two-person and three-person games with binary choices that test
these theories more directly than the array of games conventionally
considered. Our experiments show strong support for the prevalence of
"quasi-maximin" preferences: People sacrifice to increase the payoffs
for all recipients, but especially for the lowest-payoff recipients.
People are also motivated by reciprocity: While people are reluctant
to sacrifice to reciprocate good or bad behavior beyond what they would
sacrifice for neutral parties, they withdraw willingness to sacrifice to
achieve a fair outcome when others are themselves unwilling to
sacrifice. Some participants are averse to getting different payoffs
than others, but based on our experiments and reinterpretation of
previous experiments we argue that behavior that has been presented as
"difference aversion" in recent papers is actually a combination of
reciprocal and quasi-maximin motivations. We formulate a model in which
each player is willing to sacrifice to allocate the quasi-maximin
allocation only to those players also believed to be pursuing the
quasi-maximin allocation, and may sacrifice to punish unfair players.
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