Under-contribution to generic advertising due to self-interested inequity aversion

Jura Liaukonyte, Timothy Richards, Harry M. Kaiser, Bradley J. Rickard

Research output: Contribution to journalArticle

2 Scopus citations

Abstract

We modify the behavioural postulate of self-centred inequity aversion to explain producers' reluctance to fund generic fruit and vegetable advertising as a result of experiencing negative utility when others benefit more from a public good than themselves, but positive utility when they earn more than others. We find that higher variability in returns decreases the probability of a favourable vote. Conversely, if information about payoffs is incomplete, if subjects are allowed to experience a trial run of a generic advertising programme, if returns are equal across producers, or if there is government support for the programme, the likelihood of approval rises.

Original languageEnglish (US)
Pages (from-to)473-497
Number of pages25
JournalEuropean Review of Agricultural Economics
Volume42
Issue number3
DOIs
StatePublished - 2015

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Keywords

  • Experimental economics
  • Generic advertising
  • Inequity aversion

ASJC Scopus subject areas

  • Agricultural and Biological Sciences (miscellaneous)
  • Economics and Econometrics

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