Generosity during COVID-19: investigating socioeconomic shocks and game framing

Abstract

This paper investigates two research questions. First, we examine the impact of the negative socioeconomic shock of the COVID-19 pandemic on generosity towards different types of recipients, and changes in generosity as the shock worsens over time. This is carried out by analysing the responses of 1255 US citizens to four dictator games played over 8 weeks of the early stages of the COVID-19 pandemic, corresponding to four different recipients: relatives, neighbours, strangers, and the state. Second, we investigate whether the order in which the games are played create a framing effect that influences social preferences in terms of generosity towards the different recipients. Results capture an increase in generosity despite the worsening pandemic, indicating strong perceived increasing marginal benefits of generosity in times of hardship. There is significant heterogeneity in the effects of additional regressors, such as perceived contagion risk, on the likelihood and amount donated to strangers, family members, or the government. At the same time, some significant effects of framing bring new evidence regarding the stability of social preferences.