The Role of Personal Involvement and Responsibility in Unfair Outcomes: A Classroom Investigation

Abstract

This paper explores new motivations behind giving. Specifically, it focuses on personal involvement and responsibility to explain why decision makers give positive amounts in dictatorial decisions. The experiment is designed to uncover these motivations. Subjects face the problem of a dictator’s allocation of an indivisible amount to one of two players; indivisibility creates an extremely unequal outcome and the dictator is given a chance to correct this outcome at a cost. The willingness to pay to correct the outcome is examined under different scenarios so that we learn about several features concerning preferences.