Whose Money is it Anyway? Ingroups and Distributive Behavior
George Mason University
Kevin A. McCabe
George Mason University - Department of Economics; George Mason University School of Law
Maria Pia Paganelli
January 11, 2010
Price theory is often used to explain reactions to rebates and subsidies that are meant to encourage charitable giving. This paper describes the results of a laboratory experiment that tests standard price theory alongside an alternative perspective based on research on the perceptions and behavior of in-groups. Using a modified dictator game, we find that rebates that decrease the price of giving only increase amounts given when they are exogenously funded by the experimenters. When rebates are funded by members of one’s group, the decreased price of giving does not lead to increased amounts given. The result suggests that the presence of an in-group mentality can mediate the relationship between giving and price.
Keywords: dictator game, price theory, altruism, ingroupsworking papers series
Date posted: January 12, 2010
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