No evidence of inequality aversion in the investment game

Rodriguez-Lara, Ismael (2018) No evidence of inequality aversion in the investment game. PLoS One, 13 (10). e0204392. ISSN 1932-6203 (doi:10.1371/journal.pone.0204392)

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Abstract

We report experimental evidence on second-movers’ behavior in the investment game (also known as the trust game) when there exists endowment heterogeneity. Using a within-subject analysis, we investigate whether or not second-movers exhibit some taste for inequality aversion by returning a larger (smaller) share of the available funds to first-movers who are initially endowed with a lesser (larger) endowment, respectively. Our data suggest that second-movers do not take into consideration the level of endowments when making their decisions as their behavior is consistent across distribution of endowments; i.e., they return the same proportion of the available funds regardless of the endowments. We indeed find that some second-movers have a tendency to return what they have received from firstmovers. In our data, there is also a substantial proportion of second-movers who are selfish and return nothing.

Item Type: Article
Additional Information: Article number = e0204392
Research Areas: A. > Business School > Economics
Item ID: 25501
Notes on copyright: Copyright: © 2018 Ismael Rodriguez-Lara. This is an open access article distributed under the terms of the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original author and source are credited.
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Depositing User: Praveen Kujal
Date Deposited: 05 Nov 2018 12:46
Last Modified: 02 Apr 2019 20:42
URI: https://eprints.mdx.ac.uk/id/eprint/25501

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