We conduct experiments in which parties face a pair of two-player pie-splitting procedures. Parties submit their strategy in each, their beliefs about their opponent's choices, and are also asked whether they prefer one procedure over the other. The procedures – a yes-no game, an ultimatum game, and a dictator game – are designed such that by all existing economic preference models, whether distributive or procedural, parties should be indifferent between them. In particular, the procedures should yield the same outcomes, the same expected outcomes and carry the same information on parties' intentions. At the same time, the procedures differ in the way they distribute decision and information rights across players, and also in their complexity and efficiency. Experimentally, parties do indeed still reveal preferences over the procedures at hand. To explore why this happens, we elicit individuals' simplicity and efficiency ratings of the procedures, and also the degree by which individuals invoke the equality of basic rights and liberties in their moral judgement – an ethical criterion not yet captured by any preference model. The preferences we find link to this data. We explore formalizations for such preferences.
- 511 Economics
- Procedural preferences
- Equality of rights
- Institutional design
Areas of Strength and Areas of High Potential (AoS and AoHP)
- AoS: Competition economics and service strategy - Quantitative consumer behaviour and competition economics