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Exploring the Role of Deontic Reasoning and World Knowledge in Wason´s Selection Task

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Revealed distributional preferences: Individuals vs. teams.

Loukas Balafoutas¹, Rudolf Kerschbamer¹, Martin Kocher²

¹University of Innsbruck, Austria.

Journal of Economic Behavior & Organization

|April 7, 2015

Summary

Teams show greater benevolence than individuals when facing disadvantageous inequality. This research explores how group dynamics influence fairness and efficiency preferences in economic decision-making.

Keywords:

Behavioral economics Distributional preferences Experimental economics Individual decisions Social preferences Stability of preferences Team decisions

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Area of Science:

Behavioral Economics
Social Psychology
Decision Sciences

Background:

Understanding distributional preferences is crucial for designing fair economic systems.
Previous research has primarily focused on individual decision-making, with less attention paid to group dynamics.

Purpose of the Study:

To experimentally compare the distributional preferences of individuals and teams.
To investigate how group composition affects fairness and efficiency considerations in resource allocation tasks.

Main Methods:

Experimental economics design involving allocation tasks.
Comparison of decision-making outcomes between individual participants and small teams.
Analysis of revealed preference types based on allocation choices.

Main Results:

Teams exhibit significantly higher benevolence than individuals when dealing with disadvantageous inequality.
Benevolence levels in advantageous inequality scenarios are comparable between individuals and teams.
Inequality aversion is prevalent in individuals but absent in teams; spiteful types are more common in individuals.
Efficiency-loving preferences are markedly more frequent in teams compared to individuals.

Conclusions:

Group decision-making processes alter distributional preferences, leading to increased benevolence in specific contexts.
The shift in preference types from individuals to teams has significant implications for understanding social and economic behaviors.
Findings highlight the importance of considering group dynamics in theories of fairness and economic behavior.