Equity Concerns Are Narrowly Framed
American Economic Journal: Microeconomics
vol. 16,
no. 2, May 2024
(pp. 147-79)
Abstract
Distributional decisions regularly involve multiple payoff components. In a series of experiments, we show that individuals sometimes exhibit narrow equity concerns: applying fairness preferences narrowly on a specific component of payoffs rather than on broader payoff consequences. This behavior results in different distributional decisions depending on which payoff component we frame individuals to consider. We document narrow equity concerns in an exceedingly simple setting—in which payoff components are tokens worth $0.01 and $0.02—and in context-rich applications including tax policy and worker compensation.Citation
Exley, Christine L., and Judd B. Kessler. 2024. "Equity Concerns Are Narrowly Framed." American Economic Journal: Microeconomics, 16 (2): 147-79. DOI: 10.1257/mic.20220266Additional Materials
JEL Classification
- C91 Design of Experiments: Laboratory, Individual
- D63 Equity, Justice, Inequality, and Other Normative Criteria and Measurement
- D81 Criteria for Decision-Making under Risk and Uncertainty
- D91 Micro-Based Behavioral Economics: Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making
- H20 Taxation, Subsidies, and Revenue: General
- J33 Compensation Packages; Payment Methods
There are no comments for this article.
Login to Comment