Confidence, power and distributive preferences
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Confidence, power and distributive preferences Yoshio Iida1 Received: 14 March 2019 / Accepted: 6 June 2020 © Springer-Verlag GmbH Germany, part of Springer Nature 2020
Abstract The aims of this study were twofold, to: (1) examine the behavior displayed by participants who expected to be nominated for donor roles in dictator games wherein initial endowments of players are determined by lottery and (2) investigate the conduct of donors who were confident in their good fortune in relation to their power as they redistributed the rewards they had gained. Results from a dictator game in which a donor is accorded the absolute power to redistribute initial income and a random dictator game in which both a donor and a recipient declare their redistributive preferences and one of them is selected randomly by a computer were compared. Confident donors made more self-serving redistribution decisions than did unconfident donors in both games, but the difference was clearer in the dictator game. In relation to their preferences exhibited before being informed of their roles, confident donors decreased their redistribution amounts after discovering their roles; the decrements in the dictator game were conspicuously larger than those in the random dictator game. In short, confident donors were greedier than unconfident donors; the difference became more pronounced when their redistributive power was unconditional even though their confidence had no rational basis. Keywords Inequity aversion · Redistributive preferences · Dictator game · Experimental study · Self-esteem · Better-than-average effect
1 Introduction Economic inequality is a serious problem in many countries. Cingano (2014) reports recent increasing trends in income disparity across the Organisation for Economic Co-operation and Development (OECD) countries and discusses the possible economic harm this has caused. Although, people are unaware of this fact, successes and failures in life, as well as income inequality, considerably depend on chance, * Yoshio Iida [email protected]‑su.ac.jp 1
Department of Economics, Kyoto Sangyo University, Motoyama, Kamigamo, Kita, Kyoto 6038555, Japan
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which is something individuals cannot control by themselves (e.g., the social class into which they were born, the educational opportunities they have had, whether they joined the job market in the right place and at the right time, and so on) (OECD 2018; Frank 2017; Taleb 2001). Nevertheless, there are hardly any studies that have investigated the way in which people’s confidence in their good fortune influences their redistributive preferences. Such an investigation is important because of the implications for income inequality. People who are in a position to determine the income of others, like policy makers or company executives, may be overly confident in their luck to be elected and their success in business. By extension, if confident individuals in positions of authority are more acquisitive than employees in subordinate positions, the in
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