It is a fundamental part of everyday life. ... are self centered â in some way about the liar (see also Camden et al. ..... lying, beyond improving self presentation.
White Lies: Why Bother?
by
Lucy F. Ackert Kennesaw State University
Bryan K. Church Georgia Tech
Xi (Jason) Kuang Georgia Tech
Li Qi Agnes Scott College
August 2007
This draft is preliminary and incomplete. Please do not quote, cite, or circulate without authors’ permission.
The views expressed here are those of the authors and not necessarily those of the Federal Reserve Bank of Atlanta or the Federal Reserve System. The authors gratefully acknowledge the financial support of the Federal Reserve Bank of Atlanta. We thank Dan Li and Ao Yang for research assistance.
White Lies: Why Bother? “The lie is a condition of life.” Friedrich Nietzsche
I. Introduction Lying is the act of intentionally trying to mislead another (see e.g., DePaulo et al. 1996). It is a fundamental part of everyday life. DePaulo et al. (1996) report that people lie in one of five social interactions, with an average of one lie per day, to about 30 percent of those they interact with. College students as a group lie even more: in one of three social interactions, with an average of two lies per day, to roughly 38 percent of the people they deal with. Though lies can be told for personal gain, the majority seem to arise for psychological reasons (DePaulo and Kashy 1998). We refer to such lies as white lies: i.e., lies that are not associated with immediate monetary gain or harm, but rather impact self image and others’ perception of behavior. Saxe (1991, 414) suggests that (white) lies “serve as a kind of social lubricant” and that complete honesty can make relationships “tedious and conflict laden.” Lying can be viewed as a skill that preserves relationships (Nyberg 1993). Accordingly, white lies may be seen as harmless and acceptable, perhaps even desirable under certain circumstances. But are white lies indeed harmless? Consider that the vast majority of such lies are self serving. DePaulo et al. (1996) report that in excess of 80 percent of lies are self centered – in some way about the liar (see also Camden et al. 1984). A fundamental concern is that the consequences of white lies result in a deterioration of behavior over time. White lies may become habitual – told easily and often (e.g., Bok 1978). Applying research on perspective taking, the implication is that liars overestimate
3 the likelihood that others engage in white lies and, perhaps more troubling, that others condone such behavior (e.g., Ross et al. 1977; Marks and Miller 1987).1 The resultant effect is that the norms of acceptable behavior are lowered. The downward spiral may continue and individuals who are compelled to tell white lies eventually tell strategic lies, which are not so benign. An analogy can be drawn to the corporate world in which scandals are the result of a steady decline in the norms of permissible behavior. White lies are akin to accountants’ efforts to devise creative means to structure financial transactions, which comply strictly with accounting rules but innocently undermine the spirit of the rules.2 The consequence of such behavior is that future actions may devolve into fraudulent behavior, akin to pernicious lies (e.g., Merchant and Rockness 1994). In the Book of Heavens, Aristotle (350 B.C.) writes that, “The least initial deviation from the truth is multiplied later a thousandfold.” Simply put, lying can have far-reaching consequences. What is needed from a research perspective is an understanding of the conditions that motivate individuals to behave dishonestly – to tell white lies. Extant findings indicate that individuals tell white lies because they are motivated to manage the impression of others (Ickes et al. 1986; DePaulo et al. 1996; DePaulo and Kashy 1998). We are interested in identifying conditions that affect individuals’ need to tell white lies as a means of impression management. We conduct a laboratory experiment using a modified dictator game in which the dictator makes a decision that affects own and other’s payoff. The dictator communicates the choice to the other, but the communication does not have to be truthful. The design is 1
Furthermore, DePaulo et al. (1996) report that individuals experience little regret associated with telling white lies and believe that others lie more frequently. 2 The Enron bankruptcy, the second largest in U.S. history, illustrates the potential disastrous consequences of accepting procedures that are not consistent with accounting rules, even if the procedures do not strictly violate the rules (Benston and Hartgraves 2002).
4 such that the dictator can make a self-interested choice (i.e., the payoff split favors the dictator), but communicate that the choice is determined by chance. The other has no way of verifying the communication. We study the effect of social distance and knowledge of circumstances on the dictator’s propensity to lie about his or her choice. In our setting, social distance is the closeness between the dictator (the person who may tell a lie) and the other (i.e., the recipient of the lie). We investigate two levels of social distance: the other is from an identifiable group, seen previously (referred to as near distance) versus the other is from a remote, nebulous group, not seen previously (referred to as far distance). In both cases, the other is unknown. The recipient of the lie cannot be identified and there are no outside repercussions from acting in a self-interested manner. Yet, individuals tell lies under such conditions (e.g., DePaulo and Kashy 1998). Briefly, we suggest that the rate of lying is greater with near distance as opposed to far distance, due to social concerns.3 With near distance, the association between the two parties is closer, which leads to the dictator being more concerned with appearance and the other’s perception of behavior. Knowledge of circumstances refers to whether the two parties are knowledgeable of the choices available to the dictator. We examine two levels: the parties have common knowledge versus asymmetric knowledge. With common knowledge, the dictator likely believes that the other can empathize with his or her behavior: i.e., the reason for the dictator’s (self-interested) behavior is understood and tacitly approved by the other. In a sense, the dictator’s cards are laid on the table and nothing is hidden. In contrast, with asymmetric knowledge, the dictator’s (self-interested) behavior can come across as 3
Our two levels of social distance involve a distant (unknown) other. We readily acknowledge that when social distance is reduced significantly, as with close acquaintances or family members, the rate of lying may drop markedly (e.g., DePaulo and Kashy 1998).
5 callous and inconsiderate, largely because the other has little insight into the dictator’s choice set. We suggest that knowledge of circumstances interacts with social distance to determine the dictator’s need to lie. As mentioned earlier, with near distance, the dictator is more concerned about managing the impression of the other. If the rationale underlying the dictator’s choice is not readily apparent, the incentive to engage in impression management is intensified. By comparison, if the rationale underlying the dictator’s choice is obvious, the incentive to engage in impression management is lessened. With far distance, the same cannot be said – the dictator is less concerned about the other’s impression of behavior, regardless of the information available. Accordingly, we expect that the effect of social on the dictator’s propensity is most pronounced when two parties have asymmetric knowledge of the surrounding circumstances. The remainder of the paper is organized as follows. Section II describes the research method, including design, participants, and procedures. Section III provides the framework for our study, and section IV presents the results. Section V offers concluding remarks.
II. Research Method 2.1 Overview We use a modified dictator game in which the dictator chooses among three payoff allocations: a self-interested option, an equitable option, and a generous option.
6 The equitable option determines payoffs probabilistically.4 This option produces a payoff for each player that is consistent with either the self-interested or generous option. After choosing a payoff allocation, the dictator sends the other a message of the option chosen. The message, however, is not binding and can be a lie. Thus, the other does not know the dictator’s choice with certainty. We manipulate social distance and knowledge of circumstances, resulting in a 2x2 experimental design. The dictator is randomly paired with an anonymous other across experimental conditions. Social distance is manipulated by varying the representation of the other, and knowledge of circumstances is manipulated by varying the information available to the other. We elaborate on the details of the manipulations later.
2.2 Participants We recruit 244 students from three medium to large public universities, each located in the southeastern United States. Participants are randomly paired, giving us 122 dictators and 122 others. The dictators include 77 males and 45 females, with an average age of 21.6 years. The others include 79 males and 43 females, with an average age of 21.3 years.5 We have 120 participants (60 pairs) in the near distance treatment, of which 70 (35 pairs) have common knowledge and 50 (25 pairs) asymmetric knowledge. We have
4
We refer to the second choice as the equitable option because the two players have equal odds of a high or low payoff. Recent research suggests that people care about payoff inequality, in addition to their own payoff (Fehr and Schmidt 1999; Ackert et al. 2007). Our goal, however, is to understand individuals’ propensity to lie, rather than to test for the presence of social preferences. 5 We do not find any statistically significant differences in the demographic characteristics of participants between experimental groups, partitioned by role (i.e., dictator or other).
7 122 participants (61 pairs) in the far distance treatment, of which 58 (29 pairs) have common knowledge and 66 (33 pairs) asymmetric knowledge.
2.3. Experimental Procedures A researcher and monitor conduct the experiment. Initially, instructions are distributed and read aloud. After the instructions are read, the dictators choose among three options to allocate payoffs, referred to as options A, B, and C and shown in Table 1. Option A is the self-interested choice (the payoff split favors the dictator), option B the equitable choice, and option C the generous choice (the payoff split favors the other). Under option B, the payoff for each player is determined independently by tossing a coin twice – the first toss determines the dictator’s payoff and the second the other’s payoff. The dictator records the option chosen.6 The dictator then chooses among three messages to communicate to the other. The potential messages include (1) “I chose option A,” (2) “I chose option B,” and (3) “I chose option C.” The second message produces a payoff for the other that is consistent with options A and C (i.e., payoffs of $10 and $5 are equally likely). Accordingly, the other does not know the dictator’s choice among the options, only what the dictator communicates. The dictator is given an envelope that includes three small slips of paper, each with a potential message. The dictator selects one of the messages and puts it in a second envelope, along with the other’s payoff.7 The second envelope is sealed and
6
In the experimental instructions, we do not use the terms dictator and other. Rather, the dictator is referred to as the sender and the other as the receiver. We use the terms dictator and other in the paper for expositional convenience. 7 If option B is chosen, the monitor tosses the coin twice to determine each player’s payoff.
8 subsequently distributed to the other. The two unused messages are put back in the original envelope and sealed. The monitor then collects the materials and pays the dictator. Afterward, the dictator completes a post-experiment questionnaire. The questionnaire is designed to collect demographic and background information and to elicit dictators’ assessment of factors that affect their choices: i.e., the option and message. The questionnaire also includes two open-ended questions, which ask participants to describe “as best as they can” how they reached their decisions in the experiment. The envelopes that contain the message and the other’s payoff subsequently are distributed, randomly, to the others. The others open the envelopes and then complete a post-experiment questionnaire. As with the dictators, the questionnaire is designed to collect demographic and background information. The questionnaire also elicits others’ assessment of the dictator’s behavior (choices) in the experiment. 2.3.1 Social Distance. Social distance is manipulated between experimental sessions. In the near distance treatment, dictators and others initially meet in the same room. Participants are informed that one half of them will remain in the current room, and the other half will proceed to another room. Participants draw from a deck of cards to determine whether they will remain in the current room or go to another room. The participants who remain in the current room take the role of the dictator. After participants are separated into two rooms, instructions are passed out and the modified dictator game commences.
9 In the far distance treatment, the dictators and others never see one another. Dictators are informed that they will be matched with another student, who is not in the current room. Dictators are told nothing further of the others. Typically, the sessions with the others are conducted several days after the dictators make their choices. Recall that the dictator’s message and other’s payoff are placed in a sealed envelope, which is collected at the end of the sessions with the dictators. 2.3.2. Knowledge of Circumstances. Knowledge of circumstances, like social distance, is manipulated between experimental sessions. The others receive a set of instructions that describes the experiment. In the common knowledge treatment, the others are presented with information similar to that given to the dictator. Specifically, the others know how each player’s payoff is determined under each option, i.e., the others’ instructions include Table 1. In the asymmetric knowledge treatment, the others are presented with a reduced set of information such that the others know how their payoff is determined, but not the dictator’s payoff. In this case, the others’ instructions include only the bottom row of Table 1.
III. Framework 3.1 Impression Management Much research indicates that individuals care about others’ impression of them and alter their behavior to manipulate others’ assessment (e.g., Goffman 1959; Schlenker 1980; Tedeschi 1981; Leary 1995). Impression management is pervasive in social and organizational settings and accounts for much, seemingly, pro-social behavior (Bolino
10 1999; Bowler and Brass 2006). The need to look good in others’ eyes is a fundamental driver of behavior. Impression management concerns can even extend to others who are not directly identifiable and anonymous, as in the case of the standard dictator game. Dana et al. (2006, 201) comment that, “The dictator game affords the dictator power and anonymity, but not invisibility.” The other still knows that someone divides a fixed amount of money, which is enough to prompt the dictator to give something. The dictator does so to preserve a positive image and avoid negative evaluation. Dana et al. (2006) conduct a dictator game in which the dictator either (1) splits $10 between self and another or (2) exits the game, keeping $9 and leaving the other nothing. The exit option is strictly dominated in monetary outcomes because the dictator can always keep $9 and give the other $1. Dana et al. vary the other’s knowledge of the dictator game, which allows them to get at the dictator’s impression management concerns. The findings indicate that when the other knows of the dictator game, approximately one-third of the dictators choose the exit option. Looking only at dictators who intend to give something (i.e., those who appear to have other-regarding preferences), nearly 40 percent choose the exit option. In sharp contrast, when the other does not know of the dictator game, almost none of the dictators choose the exit option – only one of 24 (4 percent). Dana et al. suggest that when both players have knowledge of the game, the dictator is concerned that playing the game will violate the other’s expectation of how the $10 should be divided, producing a negative evaluation. By exiting the game, the negative evaluation, presumably, can be avoided. The implication
11 is that impression management concerns have a direct and pronounced effect on the dictator’s behavior.
3.2 Social Distance Park (1924) refers to social distance as the intimacy that prevails between groups and individuals. Early work focuses on race and ethnicity, but a variety of other factors can affect social distance, including family relations, cultural orientation, sex, age, height, etc. (e.g., Borgadus 1925; Tajfel 1971; Gallois et al. 1984; Buchan et al. 2006). As the emotional proximity among individuals increases (e.g., shared interests or physical traits) social distance is reduced. Research findings in the U.S. suggest that individuals have a more favorable attitude of others and are more concerned about others’ well-being when social distance is near rather than far. Tajfel at al. (1971) conduct a laboratory study to investigate whether random group assignment can affect behavior toward others. In their study, participants do not know the specific identity of other group members and interactions do not occur. Group membership is entirely ad hoc. The experimental task requires participants to allocate rewards to others, excluding self. The findings indicate that participants show a strong preference of allocating more rewards to same-group members, even to the extent of forgoing choices that maximize total wealth across all others. Participants’ behavior is indicative of stronger associations with same-group members (see also Messick and Mackie 1989). Research using economic games also provides evidence that social distance can affect other-regarding behavior, still maintaining anonymity among participants.
12 Charness and Gneezy (forthcoming) find that dictators give more when the other’s surname is known versus unknown. Charness et al. (2007) find greater reciprocity when experimental sessions are conducted in the classroom as opposed to the Internet. Buchan et al. (2006) find that trust and reciprocity increase, in the U.S., when participants are paired (anonymously) with another from the same group as opposed to a different group. Reductions in social distance promote individuals’ concern about what others think. Schlenker and Pontari (2000) suggest that individuals care more about self image when interacting with others who are psychologically closer. With near others, individuals’ have a salient goal to achieve a positive social outcome, providing impression motivation (Leary and Kowalski 1990). Thus, individuals have a greater need to construct a desired image (or to avoid an undesired image) when others are near as opposed to far. In our setting, the standard economic assumption of homo economicus suggests that the dictator will choose the self-interested option (i.e., option A in Table 1). But if the dictator is concerned about appearances, as suggested by Dana et al. (2006), the dictator may lie about the choice. Based on the previous discussion, the dictator’s concern over appearances is greater when the other is near as opposed to far. Hence, the dictator is more likely to lie when the other is near, in which case the dictator communicates that the equitable option is chosen (i.e., option B in Table 1). DePaulo et al. (1996, 980) put forward that lying is an “extreme form of impression management that involves the deliberate fostering of a false impression rather than the judicious editing of a true one.” Leary and Kowalski (1990) proffer that “selfpresentational deceit is permissible,” even though individuals typically do not condone
13 lying. Individuals are able to reconcile such behavior with their self concept (e.g., convincing themselves that white lies do not hurt anyone). Buss and Briggs (1984) suggest that pretense or lying is more likely to occur when relationships are superficial, as with an anonymous other.8 In our setting, the dictator lies to realize psychological rewards.9 Lying permits the dictator to appear as kind and protects the dictator from disapproval. DePaulo et al. (1996) suggest that such psychological reasons frequently motivate the telling of white lies. Therefore, in our modified dictator game, the dictator is more likely to engage in impression management when others are near as opposed to far. To manage the other’s impression, the dictator lies about the option choice (i.e., payoff split). Our first hypothesis is as follows. H1: The dictator is more likely to lie about the option choice when the social distance of the other is near as opposed to far.
3.3 Social Distance and Knowledge of Circumstances The effect of social distance on the dictator’s propensity to lie may be affected by the other’s knowledge of the dictator’s choice set. We expect that knowledge of circumstances (asymmetric versus common) impacts the dictator’s impression motives when the other is near, but not far. As discussed earlier, impression motives are strengthened when social distance is reduced. In our setting, the near other is a fellow student, seen previously, with whom the dictator may empathize, creating impression
8
With deeper relationships, pretense or lying becomes more problematic (see e.g., DePaulo and Kashy 1998). A close acquaintance or family member may be more likely to detect a lie and, over time, the lie may unravel. 9 Obviously, lies also may be told because of monetary consequences. Gneezy (2005) finds that the likelihood of lying is positively associated with the gains that arise from such behavior and negatively associated with the costs to another.
14 management concerns. In contrast, the far other is abstract and remote (unseen and illdefined), minimizing impression management concerns. With near social distance, the dictator may imagine how the other reacts upon receiving the envelope with the other’s payoff and the message of the option choice. Putting oneself in another’s shoes, however, is not easy. An anchoring and adjustment heuristic is often used in perspective-taking: i.e., individuals make a self-assessment first and adjust it to project others’ assessment (Tversky and Kahneman 1974; Nickerson 1999). The extant evidence indicates that the adjustment is typically insufficient. More specifically, individuals’ perceptions of others’ assessment are overly anchored on their self assessment (Epley et al. 2004).10 The effect is particularly pronounced when self and other share common knowledge of the surrounding circumstances (Ross and Ward 1996). 3.3.1. Asymmetric Knowledge. With asymmetric knowledge, the other only observes his or her payoff and has little insight into why the dictator chooses a particular option. The dictator’s exposure of looking bad in the eyes of the other is magnified. If the dictator chooses the self-interested option, the other receives the lowest possible payoff and the dictator’s actions may be seen as thoughtless and uncaring (refer to Table 1). The dictator envisions that choosing the self-interested option and communicating truthfully creates feelings of uneasiness and leads to the other’s displeasure. Hence, with near social distance and asymmetric knowledge of payoffs, the dictator has strong impression motives to avoid an undesired image – one that evokes disapproval and negative reactions (e.g., Schlenker 1985; Ogilivie 1987). Asymmetric knowledge reinforces the impression motives that are created by near social distance. Choosing the
10
Other research shows that individuals overestimate the likelihood that others share their opinions (Ross et al. 1977; Mullen et al. 1985).
15 self-interested option, thus, necessitates that the dictator construct an impression that is more favorable than justified (e.g., Baumeister and Jones 1978; Baumeister 1982). To do so, the dictator must lie about the option choice. 3.3.2. Common Knowledge. The situation changes when the dictator and other have common knowledge of payoffs. In this case, the dictator and other share information about one another’s payoff. Now, the dictator’s assessment of what constitutes appropriate and acceptable behavior may be egocentrically biased (e.g., Loewenstein 1996). The dictator’s choice of the self-interested option seems sensible, and the dictator imagines the other sees it that way. The rationale is that whoever is in the role of the dictator is expected to choose the self-interested option. Further, common knowledge provides the dictator with moral license to openly choose the self-interested option (Cain et al. 2006). As a consequence, common knowledge works to counter the impression motives created by near social distance. 3.3.3. Interactive Effects. The preceding discussion suggests that social distance and knowledge of circumstances have an interactive effect on the dictator’s propensity to lie. With asymmetric knowledge of payoffs, the impression motives that arise due to near social distance are intensified. By comparison, with common knowledge of payoffs, the impression motives that arise due to near social distance are dampened. The interactive effect is captured by the following hypotheses. H2a: With asymmetric knowledge of payoffs, the effect of social distance on the dictator’s propensity to lie about the option choice is increased. H2b: With common knowledge of payoffs, the effect of social distance on the dictator’s propensity to lie about the option choice is diminished.
16 IV. Results 4.1 The Dictator’s Option Choice First we examine the frequency of the dictator’s choice among the three options. The purpose is to determine whether the dictators exhibit self-interested behavior. Otherwise, there is not reason to lie about the option choice. We find that 68.9 percent (84 of 122) choose the self-interested option, 28.7 percent (35 of 122) the equitable option, and 2.5 percent (3 of 122) the generous option. The breakdown by experimental condition is shown in Figure 1. The choices are similar across the four groups: e.g., the proportion of dictators who choose the self-interested option ranges from 65.7 to 72.4 percent. A chi-squared test indicates that the option choice is independent of the experimental condition (χ2 = 1.33, p = 0.970). The primary finding, for our purposes, is that the majority of the dictators choose the self-interested option.11 Not surprisingly, a binomial test indicates that the dictator is more likely to choose the self-interested option than the other options at p < 0.001. As part of the post-experiment questionnaire, the dictators indicate how important several factors are in making their option choice. The dictators respond on a ten-point scale, with endpoints labeled 1=not important at all and 10=very important. The two most important factors are “the dictator’s payment” (mean=8.3) and “what makes the most economic sense” (mean=8.0). The dictators also explain, in an open-ended manner, how they made their option choice. Most provided responses consistent with maximizing own payoff. One participant stated that, “I selected the option that maximized my profit.” Another
11
The fact that a nontrivial proportion of the dictators choose the equitable or generous option is attributable to individual differences. The data suggest that such differences are randomized across the four experimental conditions: i.e., the breakdown of the dictators’ choices is similar across the experimental conditions.
17 explained that, “I chose the option that seemed to be the most beneficial to me.” Hence, the dictators, as a group, acknowledge making self-interested choices. Now we turn to the main focus of the paper, whether the dictator is compelled to lie about his or her option choice.
4.2 To Lie or Not To Lie We examine the frequency that the dictator’s message does not coincide with the option choice, which constitutes a white lie. We find that 14.8 percent of the dictators (18 out of 122) lie about their option choice. Every instance of lying occurs when the dictator chooses the self-interested option. Focusing on this subset, we find that 21.4 percent of the dictators lie (18 out of 84). Although the proportion is reasonably small, it is far from trivial – especially considering that the dictator does not gain anything from lying, beyond improving self presentation. We examine the breakdown of lying across the four experimental conditions. The data are depicted in Figure 2: Panel A includes all participants and Panel B only includes those who choose the self-interested option. The data suggest pronounced differences between the experimental conditions. Casual observation indicates that lying occurs more frequently when social distance is near as opposed to far, which is suggested by H1. To better gauge whether the data are suggestive of an interactive effect, we plot the frequency of lying by experimental condition, shown in Figure 3. The data plots suggest that the effect of social distance on the dictator’s propensity to lie is greater with asymmetric knowledge than common knowledge, which is suggested by H2a and H2b.
18 We conduct statistical tests to assess our hypotheses. According to H1, the dictator is more likely to lie about the option choice when social distance is near than far.
19 Figure 1 Frequency of the Dictator’s Option Choice
35 30 25 69.7% 72.4%
20
65.7% 68.0%
15 10 5 0 Far-Asymmetric
Far-Common Option A
Near-Asymmetric
Option B
Near-Common
Option C
Notes: Far and near refer to the two treatments in the social distance manipulation. Common and asymmetric refer to the two treatments in the knowledge of circumstances manipulation. Option A corresponds to the self-interested choice, option B corresponds to the equitable choice, and option C corresponds to the generous choice. The percentages represent the portion of participants who choose option A in each experimental cell.
20 Figure 2 Frequency of Dictator Lying About Option Choice Panel A: All Option Choices
35 30 25 20 15 28.6%
10 5 0
20.0%
10.3% 0% Far-Asymmetric
Far-Common
Near-Asymmetric
Lie
Near-Common
Truth
Panel B: Only Self-Interested (Option A) Choices
25 20 15 43.5%
10 5 0
29.4%
14.3% 0% Far-Asymmetric
Far-Common Lie
Near-Asymmetric
Near-Common
Truth
Notes: Far and near refer to the two treatments in the social distance manipulation. Common and asymmetric refer to the two treatments in the knowledge of circumstances manipulation. A lie occurs when the dictator’s message does not coincide with his or her option choice. The percentages represent the portion of participants who lie in each experimental cell.
21 Figure 3 Data Plot of Mean Frequencies of Lying Panel A: All Option Choices 50 40 30 Near
20
Far
10 0 Asymmetric
Common
Panel B: Only Self-Interested (Option A) Choices 50 40 Near
30 20
Far
10 0 Asymmetric
Common
Notes: The endpoints in each panel represent the proportion of participants who lie, which occurs when the dictator’s message does not coincide with his or her option choice. Far and near refer to the two treatments in the social distance manipulation. Common and asymmetric refer to the two treatments in the knowledge of circumstances manipulation.
22 Table 1 Modified Dictator Game
Player
Option A (Self-Interested)
Dictator
$ 10
50% $ 5 50% $ 10
Option C (Generous) $5
$10 50% $ 5 Notes: The dictator chooses among the three options to determine each player’s payoff. The cell entries include the payoff for each player under the different options. For option B, the payoff for each player is determined independently. A coin is tossed twice: a heads indicates a payoff of $10 and a tails $5. The first toss determines the dictator’s payoff, and the second toss the other’s payoff. Other
$5
Dictator’s Choice Set Option B (Equitable) 50% $ 10
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