Happiness and Preferences in a Legality Social Dilemma: Comparing the Direct and Indirect Approach

Abstract

We investigate players’ preferences in a multiplayer prisoner’s dilemma by comparing results from a direct (satisfaction based) and an indirect (choice based) approach. Both approaches provide strong evidence of preference heterogeneity, with players who cooperate above median being less affected in their choice by monetary payoffs vis-à-vis the public good component. The combination of a legality frame plus a conformity information design reduces further the relative preference (satisfaction) for the non-cooperative choice for such players. Our findings support the hypothesis that (part of the) players have, in addition to the standard self-interest component, an other-regarding preference argument that is further satisfied in the legality frame plus conformity design.

Keywords: Analysis of Collective Decision-Making, Corruption, Laboratory Experiment, Legality Game, Redistribution, Conformity

JEL Classification: D7, D73, C92, H2