How Did Distributional Preferences Change During the Great Recession?

39 Pages Posted: 26 May 2014

See all articles by Raymond J. Fisman

Raymond J. Fisman

National Bureau of Economic Research (NBER); Boston University

Pamela Jakiela

University of Maryland

Shachar Kariv

University of California, Berkeley - Department of Economics

Date Written: May 2014

Abstract

We compare behavior in experiments measuring distributional preferences during the "Great Recession" to behavior in identical experiments conducted during the preceding economic boom. Subjects are drawn from a diverse pool of students whose socioeconomic composition is largely held constant by the university, mitigating concerns about differential selection across macroeconomic conditions. Subjects exposed to the recession are more selfish and more willing to sacrifice equality to enhance efficiency. Reproducing recessionary conditions inside the laboratory by confronting subjects with losses has the same impact on distributional preferences, bolstering the interpretation that economic circumstances, rather than other factors, are driving our results.

Suggested Citation

Fisman, Raymond and Jakiela, Pamela and Kariv, Shachar, How Did Distributional Preferences Change During the Great Recession? (May 2014). NBER Working Paper No. w20146, Available at SSRN: https://ssrn.com/abstract=2441777

Raymond Fisman (Contact Author)

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
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Boston University ( email )

595 Commonwealth Avenue
Boston, MA 02215
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Pamela Jakiela

University of Maryland ( email )

College Park
College Park, MD 20742
United States

Shachar Kariv

University of California, Berkeley - Department of Economics ( email )

549 Evans Hall #3880
Berkeley, CA 94720-3880
United States

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