Relative earnings and giving in a real-effort experiment

Nisvan Erkal, Lata Gangadharan, Nikos Nikiforakis

    Research output: Contribution to journalArticle

    Abstract

    This paper investigates the relationship between relative earnings and giving in a twostage, real-effort experiment. In the first stage, four players compete in a tournament that determines their earnings. In the second stage, they decide whether to make a transfer to one or more of their group members. Our main finding is that those ranked first are significantly less likely to give than those ranked second. This difference disappears if individuals learn about the second stage after earning their income or if earnings are randomly determined. This suggests that our main finding is driven by selection based on other-regarding preferences.

    Original languageEnglish (US)
    Pages (from-to)3330-3348
    Number of pages19
    JournalAmerican Economic Review
    Volume101
    Issue number7
    DOIs
    StatePublished - Dec 1 2011

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    Experiment
    Tournament
    Income
    Other-regarding preferences

    ASJC Scopus subject areas

    • Economics and Econometrics

    Cite this

    Relative earnings and giving in a real-effort experiment. / Erkal, Nisvan; Gangadharan, Lata; Nikiforakis, Nikos.

    In: American Economic Review, Vol. 101, No. 7, 01.12.2011, p. 3330-3348.

    Research output: Contribution to journalArticle

    Erkal, N, Gangadharan, L & Nikiforakis, N 2011, 'Relative earnings and giving in a real-effort experiment', American Economic Review, vol. 101, no. 7, pp. 3330-3348. https://doi.org/10.1257/aer.101.7.3330
    Erkal, Nisvan ; Gangadharan, Lata ; Nikiforakis, Nikos. / Relative earnings and giving in a real-effort experiment. In: American Economic Review. 2011 ; Vol. 101, No. 7. pp. 3330-3348.
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