Distributive Justice with Production and the Social Contract. An Experimental study

Giacomo Degli Antoni (), Marco Faillo (), Lorenzo Sacconi () and Pedro Francés-Gomez
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Lorenzo Sacconi: University of Trento
Pedro Francés-Gomez: University of Granada

No wp60, Econometica Working Papers from Econometica

Abstract: Drawing on the theoretical and experimental literature on distributive justice, we put some assumptions of the contractarian argument to an empirical test by means of an experiment which investigates the influence that explicit agreement under the veil of ignorance may have on individuals' conception of justice and its implementation in a context of the production and distribution of a common output. One crucial characteristic of our experiment is that subjects are assigned unequal endowments for which they are not responsible; the assignment is random. At the same time, their work naturally generates unequal levels of earnings. Do the subjects involved in this interaction distinguish between the two types of inequality? Do they try to reduce the arbitrary one, while accepting the one generated through effort? Do they elaborate other distributive criteria? Does their choice ex-ante, when they are behind the veil, differ from their choice ex-post once the veil has been lifted and they know the outcome of the production phase? The main result is that the agreement under a veil of ignorance induces subjects to accept a liberal egalitarian division rule not only in the ex-ante agreement, but also in the actual implementation of the pie division, even if this contradicts their self-interest and some common economic assumptions about reciprocal expectations of rationality. In addition, our results show that deliberating through open discussion increases the level of ex-post compliance.

Keywords: Trust; Distributive justice, social contract, fairness, dictator game, contractarian business ethics (search for similar items in EconPapers)
JEL-codes: C72 C91 D02 D63 (search for similar items in EconPapers)
Date: 2016-09
New Economics Papers: this item is included in nep-exp, nep-gth, nep-hme, nep-hpe and nep-soc
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