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Does Inequality Cause a Difference in Altruism Between the Rich and the Poor? Evidence from a Laboratory Experiment

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Abstract

Increasing research evidence indicates that economic inequality leads the rich to be less generous than the poor. While compelling, the underling mechanism of the finding remains elusive. We conduct a laboratory experiment to investigate how inequality influences people’s behavior in a sharing game. We test varying causes of inequality to see how people share payoffs with others when inequality is caused respectively by chance, competition, and choice. The experiment result shows that the rich give less than the poor only when inequality is self-chosen. Yet, different from findings in previous studies, increasing inequality does not reinforce, but instead mitigates the negative relationship of income and giving. Our study suggests that research on the consequences of inequality should be careful on discerning whether self-choice of inequality could account for the spurious effect of inequality on people’s prosocial behavior.

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Notes

  1. Source: Central intelligence agency of the U.S.

  2. In the pre-survey, we only showed the relative positions of the five actors along the payoff spectrum. The exact payoff for each position, as shown in Fig. 1, was however not disclosed to enrolled participants. In other words, what they viewed is a general picture of the distributions, and not detailed payoffs for each position.

  3. In fact, only less than 1% of the enrolled participants wrongly pointed out that case i is more unequally distributed than case ii in Fig. 1.

  4. The 266 participants were playing the role of the dictator (giver) in the experiment. We additionally recruited N = 122 participants to be the dictatees (recipient). As many of the dictator participants chose to give zero payoff to the dictatee, we did not recruit an equal number of dictatees to the experiment.

  5. We follow Arai (2011) to cluster the standard errors of the regression coefficients.

  6. We thank a reviewer for the suggestion.

  7. The result also shows no difference in task performance between the “random” treatment and the other treatments, suggesting that participants did not underperform despite knowing that their performance was unrelated to how much they would receive for payoffs in the experiment.

  8. The question of whether men are more competitive than women remains inconclusive in social science research. While substantial research findings in experimental economics show that men tend to choose more competitive payment schemes than women do in experiments (Buser et al. 2014; Niederle and Versterlund 2011), evidence from social psychological research using different measurements of competitiveness, such as the SOV test employed in our study, does not find a significant difference between men and women in competitiveness (Balliet et al. 2011; Buunk and Massar 2012). Thus, the fact that we did not find men to be more competitive than women in our experiment cannot be seen as an anomaly of the participants recruited to our study.

  9. We thank a reviewer for this comment.

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Acknowledgements

We appreciate the financial support of the “Direct Grant” provided by the Faculty of the Social Sciences of the Chinese University of Hong Kong.

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Authors and Affiliations

  1. Institute of Sociology, Academia Sinica, Taipei, 11529, Taiwan, Republic of China

    Yen-Sheng Chiang

  2. Department of Sociology, South China Agricultural University, Guangzhou, People’s Republic of China

    Jacqueline Chen Chen

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  1. Yen-Sheng Chiang
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  2. Jacqueline Chen Chen
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Correspondence to Yen-Sheng Chiang.

Appendices

Appendix 1

See Fig. 5.

Fig. 5
figure 5figure 5

Snapshots of the memory task

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Appendix 2

See Fig. 6.

Fig. 6
figure 6

Snapshots of the charts for illustration of income distribution (The original language in the experiment is Chinese)

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Appendix 3

See Table 3.

Table 3 Hurdle regression on the probability and amount of giving
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Chiang, YS., Chen, J.C. Does Inequality Cause a Difference in Altruism Between the Rich and the Poor? Evidence from a Laboratory Experiment. Soc Indic Res 144, 73–95 (2019). https://doi.org/10.1007/s11205-018-2029-6

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