Inequality and fairness with heterogeneous endowments

PLoS One. 2022 Oct 31;17(10):e0276864. doi: 10.1371/journal.pone.0276864. eCollection 2022.

Abstract

People differ in intelligence, cognitive ability, personality traits, motivation, and similar valued and, to a large degree, inherited characteristics that determine success and achievements. When does individual heterogeneity lead to a fair distribution of rewards and outcomes? Here, we develop this question theoretically and then test it experimentally for a set of structural conditions in a specific interaction situation. We first catalogue the functional relationship between individual endowments and outcomes to distinguish between fairness concepts such as meritocracy, equality of opportunity, equality of outcomes, and Rawl's theory of justice. We then use an online experiment to study which of these fairness patterns emerge when differently endowed individuals can share their resources with others, depending on whether information about others' endowments and outcomes is available. We find that while visible outcomes lessen inequality by decreasing the statistical dispersion of outcomes across the group, endowments need to be visible for better equality of opportunity for the most disadvantaged.

Publication types

  • Research Support, Non-U.S. Gov't

MeSH terms

  • Financial Management*
  • Humans
  • Motivation
  • Reward*
  • Social Justice

Associated data

  • figshare/10.6084/m9.figshare.21103021.v1

Grants and funding

This research was made possible through the generous support of the Volkswagen Foundation (Grant Ref. 92 173). The game development was partially supported by the Carlsberg Foundation (Grant no. CF16–0593). The funders had no role in the study design, data collection and analysis, decision to publish, or preparation of the manuscript.