Not Playing Favorites: An Experiment on Parental Fairness Preferences

65 Pages Posted: 12 Feb 2020

See all articles by James Berry

James Berry

University of Delaware - Economics

Rebecca Dizon-Ross

University of Chicago

Maulik Jagnani

Yale University - Economic Growth Center

Multiple version iconThere are 2 versions of this paper

Date Written: February 10, 2020

Abstract

We conduct a lab-in-the-field experiment to identify parents' preferences for investing in their children. The experiment exogenously varied the short-run returns to educational investments to identify how much parents care about maximizing total household earnings, minimizing cross- sibling inequality in "outcomes" (child-level earnings), and minimizing cross-sibling inequality in "inputs" (child-level investments). We show that while parents place some weight on maximizing earnings, they also display a strong preference for equality in inputs, forgoing roughly 40% of their potential earnings or 90% of a day’s wage to equalize inputs. We find no evidence that parents care about equalizing outcomes.

JEL Classification: I20, J13

Suggested Citation

Berry, James and Dizon‐Ross, Rebecca and Jagnani, Maulik, Not Playing Favorites: An Experiment on Parental Fairness Preferences (February 10, 2020). University of Chicago, Becker Friedman Institute for Economics Working Paper No. 2020-06. Available at SSRN: https://ssrn.com/abstract=3535837 or http://dx.doi.org/10.2139/ssrn.3535837

James Berry

University of Delaware - Economics ( email )

Newark, DE 19716
United States

HOME PAGE: http://https://sites.google.com/site/econjimberry/

Rebecca Dizon‐Ross (Contact Author)

University of Chicago ( email )

1101 East 58th Street
Chicago, IL 60637
United States

Maulik Jagnani

Yale University - Economic Growth Center ( email )

Box 208269
New Haven, CT 06520-8269
United States

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