Measuring tastes for equity and aggregate wealth behind the veil of ignorance

  • Jan Heufer
  • , Jason Shachat*
  • , Yan Xu
  • *Corresponding author for this work

Research output: Contribution to journalArticleAcademicpeer-review

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Abstract

We propose an instrument to measure individuals' social preferences regarding equity and efficiency behind a veil of ignorance while controlling for idiosyncratic risk preferences. We construct a battery of portfolio and wealth distribution choice problems sharing a common budget set. A given bundle induces the same distribution over an individual's wealth in both problems. The portfolio choice solely reflects an individual's risk attitude, providing a benchmark to evaluate whether their wealth distribution choice exhibits equity or efficiency preferring tastes. Our experiments show clusters of social preference types, which are unexpectedly independent of risk preferences.

Original languageEnglish
Pages (from-to)209-232
Number of pages24
JournalGames and Economic Behavior
Volume153
DOIs
Publication statusPublished - Oct-2025

Keywords

  • Inequity aversion
  • Revealed preference
  • Risk preferences
  • Social preferences
  • Veil of ignorance

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