This setting lets you change the way you view articles. You can choose to have articles open in a dialog window, a new tab, or directly in the same window.
Open in Dialog
Open in New Tab
Open in same window

American Economic Review: Vol. 99 No. 5 (December 2009)

Expand

Quick Tools:

Print Article Summary
Export Citation
Sign up for Email Alerts Follow us on Twitter

Explore:

AER - All Issues

AER Forthcoming Articles

Peer-Induced Fairness in Games

Article Citation

Ho, Teck-Hua, and Xuanming Su. 2009. "Peer-Induced Fairness in Games." American Economic Review, 99(5): 2022-49.

DOI: 10.1257/aer.99.5.2022

Abstract

People exhibit peer-induced fairness concerns when they look to their peers as a reference to evaluate their endowments. We analyze two independent ultimatum games played sequentially by a leader and two followers. With peer-induced fairness, the second follower is averse to receiving less than the first follower. Using laboratory experimental data, we estimate that peer-induced fairness between followers is two times stronger than distributional fairness between leader and follower. Allowing for heterogeneity, we find that 50 percent of subjects are fairness-minded. We discuss how peer-induced fairness might limit price discrimination, account for low variability in CEO compensation, and explain pattern bargaining. (JEL C72, D63 )

Article Full-Text Access

Full-text Article

Additional Materials

Download Data Set (63.09 KB)

Authors

Ho, Teck-Hua (U CA, Berkeley)
Su, Xuanming (U CA, Berkeley)

JEL Classifications

C72: Noncooperative Games
D63: Equity, Justice, Inequality, and Other Normative Criteria and Measurement


American Economic Review


Quick Tools:

Sign up for Email Alerts

Follow us on Twitter

Subscription Information
(Institutional Administrator Access)

Explore:

AER - All Issues

AER - Forthcoming Articles

Virtual Field Journals


AEA Member Login:


AEAweb | AEA Journals | Contact Us