An experimental study on individual choice, social welfare, and social preferences

Traub, Stefan; Seidl, Christian; Schmidt, Ulrich

doi:10.1016/j.euroecorev.2008.04.002

Cited by 47 publications

(36 citation statements)

References 53 publications

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“…In an experiment with considerable financial incentives, Traub et al (2008) showed that subjects put relatively high weight on efficiency consideration (in terms of Pareto dominance) as compared to equity consideration (in terms of transfer and Lorenz dominance) when faced with an equity-efficiency trade-off. Note also that from an empirical point of view the transfer principle is highly controversial.…”

Section: Resultsmentioning

confidence: 99%

“…Apart from theoretical concerns (see, for example, Mongin, 2001), the literature suggests that the relationship between a social planner's distributional preferences and income distributions is more complex than stated by 3 The large existing body of experimental literature concerned with redistribution problems comprises, for example, Cowell, 1992, 2000;Ballano and Ruiz-Castillo, 1993;Frohlich and Oppenheimer, 1994;Seidl, 1994a, 1994b;Bernasconi, 2002;Bosmans and Schokkaert, 2004;Traub et al, 2005Traub et al, , 2008. However, to our best knowledge this is the first study to contrast empirical findings concerning the change of institutions such as the pension system with experimental micro data.…”

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confidence: 99%

“…Likewise, in an experimental "beauty contest" of social welfare functions Traub et al (2005) demonstrated that a quadratic social welfare function (Epstein and Segal, 1992) which expresses randomization preferences performed remarkably well. As a consequence of such procedural fairness motives entering the self-interested social planner's preference, she is likely to avoid extreme outcomes in terms of insufficiently low or excessively high incomes (see Traub et al, 2008).…”

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confidence: 99%

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Back to Bismarck? Shifting Preferences for Intragenerational Redistribution in OECD Pension Systems

Krieger

Traub

2008

SSRN Journal

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Abstract Using a sample of 20 OECD countries it is shown that the majority of countries decreased the level of intragenerational redistribution in the first pillar of their pension systems, though the evidence is weak in statistical terms. We find strong correlations between changes of the so-called Terms of use: Documents in EconStor mayBismarckian factor and changes of the generosity of the pension system, the shape of the income distribution in terms of its first three central moments and life expectancy. An economic laboratory experiment confirms that these variables could have been causal for the observed change.JEL classification: H55, D71, J18, D63, C92

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Section: Resultsmentioning

confidence: 99%

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confidence: 99%

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confidence: 99%

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Back to Bismarck? Shifting Preferences for Intragenerational Redistribution in OECD Pension Systems

Krieger

Traub

2008

SSRN Journal

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“…Krawczyk (2007) provides a model of both outcome and process fairness. Gächter and Riedl (2006) and Traub et al (2006) discuss more complex fairness norms at the individual level for which second-stage models could be developed and implemented through the twostage approach. Very different and possibly complex individual fairness notions can be accommodated by utilitarianism with all-inclusive utility.…”

Section: Discussionmentioning

confidence: 99%

Individual fairness in Harsanyi’s utilitarianism: operationalizing all-inclusive utility

Trautmann

2008

Theory Decis

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Fairness can be incorporated into Harsanyi's utilitarianism through all-inclusive utility. This retains the normative assumptions of expected utility and Pareto-efficiency, and relates fairness to individual preferences. It makes utilitarianism unfalsifiable, however, if agents' all-inclusive utilities are not explicitly specified. This note proposes a two-stage model to make utilitarian welfare analysis falsifiable by specifying all-inclusive utilities explicitly through models of individual fairness preferences. The approach is applied to include fairness in widely discussed allocation examples.

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“…Traub, Seidl et al (2009) test a "social planner", but on pure allocation choices. Rockenbach and Wolff (2016) have a different research question.…”

Section: If Additionally Individuals Can Misrepresent Their Types ?mentioning

confidence: 99%

Experimental Social Planners: Good Natured, But Overly Optimistic

Engel

Hippel

2017

SSRN Journal

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in AbstractPublic goods are dealt with in two literatures that neglect each other. Mechanism design advises a social planner that expects individuals to misrepresent their valuations. Experiments study the provision of the good when preferences might be non-standard. We introduce the problem of the mechanism design literature into a public good experiment. Valuations for the good are heterogeneous. To each group we add a participant with power to impose a contribution scheme. We study four settings: the authority has no personal interest and (1) valuations are common knowledge or (2) active participants may misrepresent their types; the authority has a personal interest (3) and must decide before learning her own valuation or (4) knows her own valuation. Disinterested social planners predominantly choose a payment rule that gives every group member the same final payoff, even if misrepresentation is possible. Authorities are overly optimistic about truth telling. Interested social planners abuse their power, except if the opportunity cost of a more balanced rule is small. JEL: C91, D02, D03, D61, D62, D64, H23, K12

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An experimental study on individual choice, social welfare, and social preferences

Cited by 47 publications

References 53 publications

Back to Bismarck? Shifting Preferences for Intragenerational Redistribution in OECD Pension Systems

Back to Bismarck? Shifting Preferences for Intragenerational Redistribution in OECD Pension Systems

Individual fairness in Harsanyi’s utilitarianism: operationalizing all-inclusive utility

Experimental Social Planners: Good Natured, But Overly Optimistic

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