Justice and Fairness Karl Schurter Interdisciplinary Center for Economic Science

Fairness is not Just Fair derived from “fair play” Different connotations “Das ist nicht fair” Fair implies equity  Equal opportunity  Equal reward

The Philosophy of Justice Retributive vs. Distributive Just desert How do we calculate desert? Veil of ignorance

Judging an Application Reason does not deliver justice Criteria for desert Weight Achievement or potential

Assumptions of the Veil of Ignorance There is only one just outcome Desert is calculable Not applicable to real problems Can be simulated in the laboratory

Procedural Justice Clearly defined rules Informed consent Symmetric information Equal opportunity

Hypotheses Justice and fairness are different motivational factors They have different impacts on economic decision-making

Experimental Design Dictator Game  Two players: A and B  Endowment given the pair  Player A must unilaterally allocate the money Informed consent

Property Rights Player A has property rights Method of entitlement affects allocation distribution  Random  Quiz  Specialized quiz

Treatments Random (Control) George Mason trivia quiz Seniority Die Roll

Random (Control) Computer pairs players Game starts immediately

George Mason Trivia Quiz Quiz begins Quizzes are scored and ranked Top player is made a player A  Paired with last Tie goes to the player who finished first

George Mason Trivia Quiz (Cont’d) Confounds justice and fairness Implications in other experimental research  Inequity aversion  Altruism

Die Roll Emphasize fair procedure Players choose even or odd after instructions Whoever guessed correctly is Player A

Seniority Emphasize justice Ranked by credit hours Draws on other campus privileges (housing, parking, course selection, etc.)

Expected Results No formal theory prediction Random treatment will include larger gifts Impact of justice and fairness varies across cultures