On Inequity Aversion: A Reply to Binmore and Shaked

Posted: 10 Mar 2009

See all articles by Ernst Fehr

Ernst Fehr

University of Zurich - Department of Economics

Klaus M. Schmidt

Ludwig Maximilian University of Munich (LMU) - Faculty of Economics; CESifo (Center for Economic Studies and Ifo Institute); Centre for Economic Policy Research (CEPR)

Date Written: February 4, 2009

Abstract

In this paper we reply to Binmore and Shaked's criticism of the Fehr-Schmidt model of inequity aversion. We put the theory and their arguments into perspective and show that their criticism is not substantiated. Finally, we briefly comment on the main challenges for future research on social preferences.

Keywords: Experiments, other-regarding preferences, inequity aversion

JEL Classification: B41, C90

Suggested Citation

Fehr, Ernst and Schmidt, Klaus M., On Inequity Aversion: A Reply to Binmore and Shaked (February 4, 2009). Available at SSRN: https://ssrn.com/abstract=1356409

Ernst Fehr

University of Zurich - Department of Economics ( email )

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Klaus M. Schmidt (Contact Author)

Ludwig Maximilian University of Munich (LMU) - Faculty of Economics ( email )

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Germany
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CESifo (Center for Economic Studies and Ifo Institute)

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Munich, DE-81679
Germany

HOME PAGE: http://www.CESifo.de

Centre for Economic Policy Research (CEPR)

London
United Kingdom

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