CeDEx workshop - Ben D'Exelle (University of East Anglia)

This article studies strategy choice in a repeated distribution game with an equity-efficiency trade-off. The pay-offs are such that substantial efficiency gains can be obtained by deviating from equal sharing. Viewed from a dynamic perspective, however, it is possible to reconcile efficiency with equity by deviating from equal sharing while rotating the person who receives the largest share. Making use of dynamic panel data estimation techniques we study how socio-economic characteristics influence the likelihood of such rotation strategy. We find that male, poorer, younger or higher educated distributors have a higher inclination to implement such rotation strategy.