Who Cares About Equity? A Social Norm Revisited
54 Pages Posted: 13 Sep 2012 Last revised: 6 Jun 2013
Date Written: June 5, 2013
We introduce a three-person redistribution game with preplay communication. Three focal points of the game are derived from different equity standards and Rawls' difference principle. An experimental test confirms our hypothesis that equity in terms of effort-proportionality is not pursued at the group level. Only a large 'middle class' and/or institutional hurdles that limit the power of the less productive prevent highly productive players from being expropriated.
Keywords: Equity, Voting, Redistribution, Cheap Talk, Real Effort Experiment
JEL Classification: D72, D63, C92
Suggested Citation: Suggested Citation