Equality, equity and incentives: An experiment

Loukas Balafoutas, Martin Kocher, Louis Putterman and Matthias Sutter

European Economic Review, 2013, vol. 60, issue C, 32-51

Abstract: We study a fundamental conflict in economic decision-making, the trade-off between equality, equity and incentives, in a new experimental game that nests a voluntary contributions mechanism in a broader spectrum of incentive schemes. In a 2×2 design, we let subjects either vote on or exogenously encounter incentive settings while assigned unequal endowments are either task-determined or random. We find that earned endowments lead to less support for redistribution and less cooperation. Subjects' voting is influenced by egalitarian and equity concerns, in addition to self-interest. Cooperation rates respond rather continuously to incentives.

Keywords: Equality; Efficiency; Incentives; Voluntary contribution mechanism; Experiment (search for similar items in EconPapers)
JEL-codes: C91 C92 D31 D63 H41 (search for similar items in EconPapers)
Date: 2013
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (74)

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Related works:
Working Paper: Equality, Equity and Incentives: An Experiment (2013)
Working Paper: Equality, Equity and Incentives: An Experiment (2010)
Working Paper: Equality, Equity and Incentives: An Experiment (2010)
Working Paper: Equality, Equity and Incentives: An Experiment (2010)
Working Paper: Equality, equity, and incentives: An experiment (2010)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:eecrev:v:60:y:2013:i:c:p:32-51

DOI: 10.1016/j.euroecorev.2013.01.005

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