Blaming the Messenger: Notes on the Current State of Experimental Economics

Abstract

Binmore and Shaked (this issue) criticize Fehr and Schmidt’s (1999) model of inequality aversion. We present a considerable body of experimental research supporting the inequality aversion motive. Binmore and Shaked also urge experimentalists to adopt “a more skeptical attitude when far-reaching claims about human behavior are extrapolated from very slender data.” It is true that experimental findings indicate that the standard neoclassical model fails to predict a considerable range of strategic behaviors widely observed in the laboratory, particularly under conditions where normative behavior is prevalent in every-day social life. This is indeed a “far-reaching claim,” but one amply justified by an impressive and constantly growing body of evidence from experiments.

Keywords: Inequality Aversion, Neoclassical Theory, Experimental Economics

JEL Classification: B4, C9, D63