When Fair Isn't Fair: Understanding Choice Reversals Involving Social Preferences

63 Pages Posted: 17 Apr 2016  

James Andreoni

University of California, San Diego (UCSD)

Deniz Aydin

Stanford University - Department of Economics

Blake Barton

Stanford University - Department of Economics

B. Douglas Bernheim

Stanford University - Department of Economics; National Bureau of Economic Research (NBER)

Jeffrey Naecker

Wesleyan University - Department of Economics

Date Written: March 22, 2016

Abstract

In settings with uncertainty, tension exists between ex ante and ex post notions of fairness (e.g., equal opportunity versus equal outcomes). In a laboratory experiment, the most common behavioral pattern is for subjects to select the ex ante fair alternative ex ante, and switch to the ex post fair alternative ex post. One potential explanation embraces consequentialism and construes the reversals as manifestations of time inconsistency. Another abandons consequentialism, thereby avoiding the implication that revisions imply inconsistency. We test between these explanations by examining the demand for commitment, and contingent planning. The hypothesis of time-consistent non-consequentialism receives strong support.

Keywords: fairness, time inconsistency, choice reversals, social preferences

Suggested Citation

Andreoni, James and Aydin, Deniz and Barton, Blake and Bernheim, B. Douglas and Naecker, Jeffrey, When Fair Isn't Fair: Understanding Choice Reversals Involving Social Preferences (March 22, 2016). Available at SSRN: https://ssrn.com/abstract=2763318 or http://dx.doi.org/10.2139/ssrn.2763318

James Andreoni

University of California, San Diego (UCSD) ( email )

9500 Gilman Drive
La Jolla, CA 92093-0508
United States

HOME PAGE: http://econ.ucsd.edu/~jandreon/

Deniz Aydin

Stanford University - Department of Economics ( email )

Landau Economics Building
579 Serra Mall
Stanford, CA 94305-6072
United States

Blake Barton

Stanford University - Department of Economics ( email )

Landau Economics Building
579 Serra Mall
Stanford, CA 94305-6072
United States

B. Douglas Bernheim

Stanford University - Department of Economics ( email )

Landau Economics Building
579 Serra Mall
Stanford, CA 94305-6072
United States
650-725-8732 (Phone)
650-725-5702 (Fax)

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Jeffrey Naecker (Contact Author)

Wesleyan University - Department of Economics ( email )

238 Church Street
Middletown, CT 06459-0007
United States

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