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http://ssrn.com/abstract=678281
 
 

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Statistical, Identifiable and Iconic Victims and Perpetrators


George Loewenstein


Carnegie Mellon University - Department of Social and Decision Sciences

Deborah Small


Carnegie Mellon University - Department of Psychology

Jeff Strnad


Stanford Law School

March 2005

Stanford Law and Economics Olin Working Paper No. 301

Abstract:     
We draw out implications of the identifiable victim effect - the greater sympathy shown toward identifiable than statistical victims - for public finance. We first review research showing (1) that people respond more strongly to identifiable than statistical victims even when identification provides absolutely no information about the victims, (2) that the identifiable victim effect is a special case of a more general tendency to react more strongly to identifiable others whether they evoke sympathy or other emotions, and (3) that identifiability influences behavior via the emotional reactions it evokes. Next, we discuss the normative status of the effect, noting that, contrary to the usual assumption that people overreact to identifiable victims, identifiability can shift people's responses in a normatively desirable direction if people are otherwise insufficiently sympathetic toward statistical victims. Finally, we examine implications of the identifiable victim effect for public finance. We show that the identifiable victim effect can influence the popularity of different policies, for example, naturally favoring hidden taxes over those whose incidence is more easily assessed, since a hidden tax has no identifiable victims. Identifiable other effects also influence public discourse, with much of the debate about government spending and taxation being driven by vivid exemplars - iconic victims and perpetrators - rather than any rational calculation of costs and benefits.

Number of Pages in PDF File: 23

Keywords: identifiable victim effect, tax policy, public finance, behavioral economics

JEL Classification: H00, H20, H30, H40, H50

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Date posted: March 7, 2005  

Suggested Citation

Loewenstein, George and Small, Deborah and Strnad, Jeff, Statistical, Identifiable and Iconic Victims and Perpetrators (March 2005). Stanford Law and Economics Olin Working Paper No. 301. Available at SSRN: http://ssrn.com/abstract=678281 or http://dx.doi.org/10.2139/ssrn.678281

Contact Information

George F. Loewenstein
Carnegie Mellon University - Department of Social and Decision Sciences ( email )
Pittsburgh, PA 15213-3890
United States
412-268-8787 (Phone)
412-268-6938 (Fax)
Deborah Small
Carnegie Mellon University - Department of Psychology ( email )
Baker Hall 342c
Pittsburgh, PA 15213
United States
James (Jeff) Frank Strnad (Contact Author)
Stanford Law School ( email )
559 Nathan Abbott Way
Stanford, CA 94305-8610
United States
650-723-9674 (Phone)
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