Abstract
We examine the impact of social distance in dictator game giving. The study is conducted in a field setting with high stakes (two days’ wages). The sample is a representative sample from eleven low-income Mexican villages. Subjects make multiple dictator decisions simultaneously, in a comparative dictator game. We show the relationship between social distance and giving using several family members, a member of the same village, and a stranger from a different village. Dictator giving shows substantial variation across recipient types and varies directly with social distance. We find higher giving towards family members than towards community members and strangers. Furthermore, our results indicate that giving to community members and to strangers is not different. In light of our results, it is important to consider the impact of social distance on inter- and intra-household transfers in policy interventions that alleviate poverty, e.g., conditional transfers.
Highlights
Economic studies separately show that inter-household and intra-household transfers generate economic assistance and facilitate risk-sharing within low-income communities [1,2,3,4,5]
We examine simultaneously inter-household and intra-household transfers using a lab-in-the-field experiment within 11 low-income Mexican villages
Our findings indicate that giving depends on the social closeness of subjects and recipients: participants share more money with family members than with community members and strangers
Summary
Economic studies separately show that inter-household and intra-household transfers generate economic assistance and facilitate risk-sharing within low-income communities [1,2,3,4,5]. Little is known about the willingness to share of individuals within and between households, and how the amount they are willing to share varies with the social distance of the recipient Both inter- and intra-household transfers entail different connections within a social network, and recent studies suggest that social networks might play a key role in the extent of resource sharing within these communities [6,7,8,9]. Following the social networks literature, this study reveals that social networks significantly affect the extent of sharing within low-income societies. Social networks exert their influence in the social and economic decisions of individuals [10,11]. Close members are family members, who are generally associated with intra-household transfers; distant members are community members and strangers, who are generally associated with inter-household transfers
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