Mind the framing when studying social preferences in the domain of losses

Abstract

There is no consensus in whether monetary losses make individuals more generous or selfish. Utilizing a dictator game (DG), we study the impact of loss framing on altruism and find that dictators’ altruism is sensitive to the loss frame they are embedded in. In a DG in which the dictators share a loss between themselves and a recipient, the monetary allocations are more benevolent than in a setting without a loss and in a DG in which the dictators share what remains of their endowments after a loss. These differences are explained by the social norms the loss frames invoke.