Featured Research

from universities, journals, and other organizations

A pinch of opportunity makes deep inequality more palatable

Date:
July 26, 2012
Source:
University of Warwick
Summary:
Just a tiny hint of opportunity has a disproportionately powerful effect - making unfairness more acceptable to disadvantaged people, new research has found.

Just a tiny hint of opportunity has a disproportionately powerful effect -- making unfairness more acceptable to disadvantaged people, new research has found.

A study by Eugenio Proto, an economist from the Centre for Competitive Advantage in the Global Economy (CAGE) at the University of Warwick and two other co-authors, looked at decision-making and how it was influenced by people's perceptions of fairness.

Researchers set up a game between two people where one person (the proposer) offers to split £10 between themselves and their partner, with the proposer able to decide the exact amount he or she is willing to offer.

If that amount is not accepted by to the second person (the responder) then neither gets any money.

Known as an ultimatum game, this kind of set-up is frequently studied by economists -- but for the first time the CAGE experiment introduced an element of inequality via an increasingly-biased rigged lottery to decide who becomes the proposer, the stronger of the two positions.

It makes sense that when people see clear-cut unfairness, they are less likely to accept it -- and this was shown in the results.

When the opportunity to become the proposer was 50 per cent -- i.e completely fair -- responders on average rejected an offer by the proposer of £2.15 or less.

And when the chance of becoming the proposer was rigged at 0 per cent -- i.e complete inequality -- responders rejected offers of £2.96 or less.

But when just a one per cent chance of becoming a proposer was introduced -- i.e the lottery was still vastly rigged biased in the proposer's favour -- responders rejected offers of £2.53 or less.

In other words the difference between having absolutely no chance and having just a one per cent chance was valued at 43p (£2.96 -- £2.53) -- proportionally much larger than the 38p value (£2.53 -- £2.15) given to the gap between 1 and 50 per cent.

Dr Eugenio Proto, Associate Professor of Economics at the University of Warwick, said he was surprised to discover this quirk in human decision-making.

"When you look at it rationally, it makes no sense that people are placing such a disproportionate value on that first one per cent increase in opportunity.

"But that slight increase in fairness seems to have some kind of symbolic meaning.

"It appears people are happy to accept extreme inequality when they have this tiny carrot dangled in front of them.

"We've got to remember that our experiments are conducted in a lab at a university, not in the real world which is far more complex.

"But these results could shed light on why people living in unequal societies aren't more vocal in rejecting unfairness.

"It seems that even if people believe they have just the tiniest of chances to become the next Bill Gates, it's enough to keep them tolerant of obvious inequality."

Anirban Kar of the Delhi School of Economics, one of the other two co-authors, added: "It makes sense that when people see clear-cut unfairness in the system, they are more likely to reject an unequal outcome than if the same outcome was generated by a fair system.

"Participation in the system, surprisingly enough, even a symbolic one (a modicum of voice) seems to have a significant impact."

The research paper Everyone Wants a Chance: Initial Positions and Fairness in Ultimatum Gameswas co-authored with Gianluca Grimalda of Universitat Jaume I, Castellσ in Spain and Anirban Kar of the Delhi School of Economics, University of Delhi.


Story Source:

The above story is based on materials provided by University of Warwick. Note: Materials may be edited for content and length.


Journal Reference:

  1. Grimalday, Gianluca & Karz, Anirban & Proto, Eugenio. Everyone Wants a Chance: Initial Positions and Fairness in Ultimatum Games. CAGE Online Working Paper Series 92, Competitive Advantage in the Global Economy, 2012

Cite This Page:

University of Warwick. "A pinch of opportunity makes deep inequality more palatable." ScienceDaily. ScienceDaily, 26 July 2012. <www.sciencedaily.com/releases/2012/07/120726094510.htm>.
University of Warwick. (2012, July 26). A pinch of opportunity makes deep inequality more palatable. ScienceDaily. Retrieved April 24, 2014 from www.sciencedaily.com/releases/2012/07/120726094510.htm
University of Warwick. "A pinch of opportunity makes deep inequality more palatable." ScienceDaily. www.sciencedaily.com/releases/2012/07/120726094510.htm (accessed April 24, 2014).

Share This



More Mind & Brain News

Thursday, April 24, 2014

Featured Research

from universities, journals, and other organizations


Featured Videos

from AP, Reuters, AFP, and other news services

Study Says Most Crime Not Linked To Mental Illness

Study Says Most Crime Not Linked To Mental Illness

Newsy (Apr. 22, 2014) — A new study finds most crimes committed by people with mental illness are not caused by symptoms of their illness or disorder. Video provided by Newsy
Powered by NewsLook.com
How Smaller Plates And Cutlery Could Make You Feel Fuller

How Smaller Plates And Cutlery Could Make You Feel Fuller

Newsy (Apr. 22, 2014) — NBC's "Today" conducted an experiment to see if changing the size of plates and utensils affects the amount individuals eat. Video provided by Newsy
Powered by NewsLook.com
Do We Get Nicer With Age?

Do We Get Nicer With Age?

Newsy (Apr. 22, 2014) — A recent report claims personality can change over time as we age, and usually that means becoming nicer and more emotionally stable. Video provided by Newsy
Powered by NewsLook.com
How to Master Motherhood With the Best Work/Life Balance

How to Master Motherhood With the Best Work/Life Balance

TheStreet (Apr. 22, 2014) — In the U.S., there are more than 11 million couples trying to conceive at any given time. From helping celebrity moms like Bethanny Frankel to ordinary soon-to-be-moms, TV personality and parenting expert, Rosie Pope, gives you the inside scoop on mastering motherhood. London-born entrepreneur Pope is the creative force behind Rosie Pope Maternity and MomPrep. She explains why being an entrepreneur offers the best life balance for her and tips for all types of moms. Video provided by TheStreet
Powered by NewsLook.com

Search ScienceDaily

Number of stories in archives: 140,361

Find with keyword(s):
 
Enter a keyword or phrase to search ScienceDaily for related topics and research stories.

Save/Print:
Share:  

Breaking News:
from the past week

In Other News

... from NewsDaily.com

Science News

Health News

Environment News

Technology News



Save/Print:
Share:  

Free Subscriptions


Get the latest science news with ScienceDaily's free email newsletters, updated daily and weekly. Or view hourly updated newsfeeds in your RSS reader:

Get Social & Mobile


Keep up to date with the latest news from ScienceDaily via social networks and mobile apps:

Have Feedback?


Tell us what you think of ScienceDaily -- we welcome both positive and negative comments. Have any problems using the site? Questions?
Mobile iPhone Android Web
Follow Facebook Twitter Google+
Subscribe RSS Feeds Email Newsletters
Latest Headlines Health & Medicine Mind & Brain Space & Time Matter & Energy Computers & Math Plants & Animals Earth & Climate Fossils & Ruins