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Preferences and Altruism

Paper Session

Saturday, Jan. 6, 2018 8:00 AM - 10:00 AM

Marriott Philadelphia Downtown, Meeting Room 404
Hosted By: Association for the Study of Generosity in Economics
  • Chair: Sarah Smith, University of Bristol

Are the Rich More Selfish Than the Poor, or Do They Just Have More Money? A Natural Field Experiment

James Andreoni
,
University of California-San Diego
Nikos Nikiforakis
,
New York University Abu Dabi
Jan Stoop
,
Erasmus University Rotterdam

Abstract

The growing concentration of resources among the rich has re-ignited a discussion about whether the rich are more selfish than others. While many recent studies show the rich behaving less prosocially, endogeneity and selection problems prevent safe inferences about differences in social preferences. We present new evidence from a natural field experiment in which we “misdeliver” envelopes to rich and poor households in a Dutch city, varying their contents to identify motives for returning them. Our raw data indicate the rich behave more pro-socially. Controlling for pressures associated with poverty and the marginal utility of money, however, we find no difference in social preferences. The primary distinction between rich and poor is simply that the rich have more money.

Moral Costs and Rational Choice: Theory and Experimental Evidence

James C. Cox
,
Georgia State University
John A. List
,
University of Chicago
Michael Price
,
Georgia State University
Vjollca Sadiraj
,
Georgia State University
Anya Samek
,
University of Southern California

Abstract

The literature exploring other regarding behavior sheds important light on interesting social phenomena, yet less attention has been given to how the received results speak to foundational assumptions within economics. Our study synthesizes the empirical evidence, showing that recent work challenges convex preference theory but is largely consistent with rational choice theory. Guided by this understanding, we design a new, more demanding test of a central tenet of economics—the contraction axiom—within a sharing framework. Making use of more than 325 dictators participating in a series of allocation games, we show that sharing choices violate the contraction axiom. We advance a new theory that augments standard models with moral reference points to explain our experimental data. Our theory also organizes the broader sharing patterns in the received literature.

Impure Impact Giving: Theory and Evidence

Daniel Hungerman
,
University of Notre Dame
Mark Ottoni-Wilhelm
,
IUPUI and Lilly School of Philanthropy

Abstract

The extant theory used to explain donor responses to third-party matched donations predicts equivalence between the price elasticities induced by a match and an appropriately set tax rebate. The extant evidence contradicts equivalence. This paper presents, for the first time, an elasticity estimate induced by a match in parallel with an estimate induced by a real-world tax rebate. The new estimates also contradict equivalence. We develop a model of impure impact giving consistent with non-equivalence. We estimate a structural version of the model, and use the structural model to obtain new insights about how matches work.
Discussant(s)
Ragan Petrie
,
Texas A&M University
Timothy Cason
,
Purdue University
A. Abigail Payne
,
University of Melbourne, Melbourne Institute: Applied Economic & Social Research
JEL Classifications
  • D6 - Welfare Economics