Intention and Stochastic Outcomes: An Experimental Study
University of California, Santa Barbara - Department of Economics
David I. Levine
University of California, Berkeley - Economic Analysis & Policy Group
December 5, 2005
Do people care about intentions - even when good intentions do not produce good results? In our experiments we find that rates of punishment and reward react strongly to intentions (the wage a firm decides to pay) and more modestly to distributional outcomes (the higher or lower wage actually received including the stochastic component). For example, workers who end up receiving 'medium' wages respond much more positively when this resulted from the firm offering a high wage (but bad luck lowered the worker's pay) than when this resulted from the firm offering a low wage (and good luck raised the pay).
Number of Pages in PDF File: 30
Keywords: Intentions, Reciprocity, Experiment, Rent-sharing, Process, Attribution
JEL Classification: A13, B49, C91, J3, J41working papers series
Date posted: October 15, 2003
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