The researchers, Professor Andrew Oswald of the University of Warwick and Dr Daniel Zizzo of Oxford, designed a new kind of experiment, played with real cash, where subjects could anonymously “burn” away other people’s money - but only at the cost of giving up some of their own money. Despite this cost to themselves, and contrary to economists’ usual assumptions, 62% of those tested chose to destroy part of other test subjects’ cash. In the experiment, half of all the laboratory earnings were deliberately destroyed by fellow subjects.
Everyone in the laboratory sessions was anonymous and hidden. The subjects had only a computer terminal, into which they played, and in which they could see how much other people were winning.
In each session, the test subjects began with a betting stage which gave them some money (about 10 pounds but sometimes much more) creating an unequal wealth distribution.
In the final stage, the “burning” stage, subjects could if they wished eliminate (“burn away”) other people’s money – but only by giving up some of their own cash winnings. At the most expensive level, they had to give up 25 pence to destroy 1 full pound owned by someone else. It was made clear to the subjects that burning others would reduce the cash of the person choosing to burn.
The economists expected little burning, and especially that the laboratory subjects would stop destroying other people’s money once the price reached 0.25, but in fact they found that even this high price did little to stop people annihilating other people’s wealth. Most individuals still chose to hurt others, despite the large cost to their own pocket.
The researchers found that those given who gained the most additional money at the betting stage, burned poor and rich alike , however disadvantaged laboratory subjects mainly targeted those subjects that they saw getting what they perceived as undeserved financial windfalls. The authors concluded that “our experiment measures the dark side of human nature”.
Note for editors: The research paper, “Are People Willing to Pay to Reduce Others’ Incomes?”, has just been published in Annales D’Economie et de Statistique, Special edition Vol 64 Feb 2002. A total of 29 sessions was performed with 4 subjects each time: the total sample was 116 subjects. The sample was mostly students and university ancillary staff. The average age of the participants was 25.
For further information contact:
Professor Andrew Oswald, Professor of Economics
University of Warwick Tel: 024 76 523510 (Office),
01367 860005 (Home) Web http://www.oswald.co.uk
email: email@example.com (office)
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