Group identity in fairness decisions : discrimination or inequality aversion?

Abstract

This paper reports preliminary evidence from a pilot study (, with 455 decisions) on issues of decision time and race in distributive fairness decisions in South Africa. We conduct a dictator game to gather data on transfer amounts and time taken for decisions, where dictators are paired with a series of partners with whom they either share or do not share race. Our results are not in line with the empirical evidence that suggests that impulsive decisions are fair: transfers in our sample increase with decision time, with fairer decisions taking longer than selfish decisions. We note significantly higher transfers to black receivers from black decision-makers. White dictators give more to white receivers in very short (15 s) decisions, but when they take more time to decide, more is given to black versus white receivers. This race-based discrimination in transfers appears to be primarily motivated by inequality aversion: black receivers are (correctly) assumed to have lower income than their white peers. Although our sample is small, the evidence of willingness to reduce perceived race-based inequality has encouraging implications for redistributive policies in the country, and therefore warrants further investigation.