Insensitivity to Prices in a Dictator Game

Jim Engle-Warnick and Natalia Mishagina ()

CIRANO Working Papers from CIRANO

Abstract: In this paper we examine the relationship between prices and violations of the Generalized Axiom of Revealed Preference (GARP) in dictator games. Using new experimental data and a new algorithm that adjusts budget prices to eliminate GARP violations, we introduce a new measure of consistency of choices, and we identify a systemic relationship between prices and violations. We find that pushing prices away from extremes tends to eliminate the violations of most subjects, a phenomenon that we call “price insensitivity”.

Keywords: Revealed Preference; GARP; Measures of Rationality; Dictator Game (search for similar items in EconPapers)
JEL-codes: C90 D11 D12 (search for similar items in EconPapers)
Date: 2016-08-24
New Economics Papers: this item is included in nep-exp, nep-gth and nep-hpe
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https://cirano.qc.ca/files/publications/2016s-45.pdf

Related works:
Working Paper: Insensitivity to Prices in a Dictator Game (2014)
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Persistent link: https://EconPapers.repec.org/RePEc:cir:cirwor:2016s-45

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