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Who shows solidarity with the irresponsible?

Friedel Bolle and Jano Costard

No SP II 2013-308, Discussion Papers, Research Unit: Economics of Change from WZB Berlin Social Science Center

Abstract: In the Solidarity game lucky winners of a lottery can transfer part of their income to unlucky losers. Will losers get smaller transfers if they can be assumed to be responsible for their zero income because they have chosen riskier lotteries? Or will risk-lovers and riskaverters favor those who made the same risk-choice, leading to larger transfers within rather than between the risk-groups? While there is support for both motives in the literature, in an experiment we find that the effect of holding people responsible for their actions is overcome by behavior guided by in-group favoritism based on different levels of risk-taking. This behavior is successfully described by a variant of the social utility function suggested by Cappelen et al. (2013).

Keywords: Risky Behaviour; Solidarity; Responsibility; In-Group Favoritism (search for similar items in EconPapers)
JEL-codes: D3 D8 (search for similar items in EconPapers)
Date: 2013
New Economics Papers: this item is included in nep-evo, nep-exp and nep-upt
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