Using a common pool resource (CPR) game with villagers whos livelihood depends on an actual CPR, we estimate a structural model of preferences for altruism, reciprocity and inequity aversion. Latent class estimates show that preferences for equity are widespread. Sociodemographic and attitudinal drivers of preference types provide internal validity. The evidence suggests that incentives to reduce individual extraction (a fine, a subsidy or a non monetary instrument) exert heterogeneous effects across types: a subsidy crowds in inequity aversion and reciprocity, while a fine crowds out the latter (but not the former). We ilustrate our type classification using data from a gift exchange designed to elicit reciprocity. We show that reciprocity is present, but preferences for equity remain essential to explain the data.
C51, C93, D63, H41, Q20
Structural Identification of Social Preferences: Heterogeneity Matters for Incentives
KeywordsReciprocity, altruism, inequity aversion, latent class models, policy intervention