BEHAVIORAL SCIENCES WORKSHOP: James Andreoni (UC San Diego), “When Fair Isn’t Fair: Sophisticated Time Inconsistency in Social Preferences”

Event time: 
Thursday, April 7, 2016 - 12:00pm through 1:15pm
James Andreoni, Professor of Economics, UC San Diego
Event description: 

How do people think about fairness in settings with uncertainty? One view holds that fairness requires equality of opportunity; another holds that it requires equality of outcomes. Relative to the resolution of uncertainty, the first view takes an ex ante perspective, while the second takes an ex post perspective. In this paper, we conduct a laboratory experiment designed to determine which perspective people adopt, and under what conditions. We find that most people view fairness from an ex ante perspective when making decisions ex ante, and from an ex post perspective when making decisions ex post. As a result, they exhibit the hallmark of time-inconsistency: after making an initial plan that is fully state-contingent, they revise it upon learning that certain states will not occur. These patterns are robust and persist even when people are aware of their proclivities. Indeed, subjects who switch from ex ante fair to ex post fair choices, and who are aware of this proclivity, generally avoid precommitments and intentionally retain the flexibility to manifest time inconsistency. We argue that these patterns are best explained by a theory of “nominal fairness.”

James Andreoni studies a variety of topics, but most involve altruistic or moral decision making. His research employs economic theory, experiments, and standard analysis of survey data. A constant interest is charitable behavior, including the interactions among individuals, and between individuals, charities, and the government. He also studies altruistic decisions in the laboratory. In addition, he has recently been conducting studies of fundamental models of decision making, including choices over gambles and over time.

The Behavioral Sciences Workshop is held jointly between the Yale departments of Economics, Political Science, Psychology, and the School of Management. Lunch will be served.

Open to: 
General Public