Identity and Redistribution: Theory and Evidence.

43 Pages Posted: 28 May 2019

See all articles by Sanjit Dhami

Sanjit Dhami

University of Leicester

Emma Manifold

University of Leicester - Department of Economics

Ali al-Nowaihi

University of Leicester - Department of Economics

Multiple version iconThere are 2 versions of this paper

Date Written: April 29, 2019

Abstract

We propose a theoretical model that combines social identity concerns (Akerlof and Kranton, 2000) with inequity averse preferences (Fehr and Schmidt, 1999). Our subjects are registered members of British political parties for whom identity and redistribution are salient. (1) Proposers and responders demonstrate ingroup-favoritism. (2) Proposers exhibit quantitatively stronger social identity effects. (3) In the presence of redistribution, offers by proposers and stated minimum acceptable offers by responders suggest a shared understanding characteristic of social norms. (4) Subjects experience more disadvantageous inequity from outgroup members relative to ingroup members.

Keywords: Social identity, Prosocial behavior, Ultimatum game, Fiscal redistribution, Entitlements

JEL Classification: D01, D03

Suggested Citation

Dhami, Sanjit and Manifold, Emma and al-Nowaihi, Ali, Identity and Redistribution: Theory and Evidence. (April 29, 2019). Available at SSRN: https://ssrn.com/abstract=3380938 or http://dx.doi.org/10.2139/ssrn.3380938

Sanjit Dhami (Contact Author)

University of Leicester ( email )

Department of Economics
Leicester LE1 7RH, Leicestershire LE1 7RH
United Kingdom

HOME PAGE: http://www2.le.ac.uk/departments/economics/people/sdhami

Emma Manifold

University of Leicester - Department of Economics ( email )

Department of Economics
Leicester LE1 7RH, Leicestershire LE1 7RH
United Kingdom

Ali Al-Nowaihi

University of Leicester - Department of Economics ( email )

Department of Economics
Leicester LE1 7RH, Leicestershire LE1 7RH
United Kingdom

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