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

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

doi:10.1093/erae/jbu032

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 journal › Article › peer-review

5 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 language	English (US)
Pages (from-to)	473-497
Number of pages	25
Journal	European Review of Agricultural Economics
Volume	42
Issue number	3
DOIs	https://doi.org/10.1093/erae/jbu032
State	Published - Jul 2015

Keywords

Experimental economics
Generic advertising
Inequity aversion

ASJC Scopus subject areas

Agricultural and Biological Sciences (miscellaneous)
Economics and Econometrics

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10.1093/erae/jbu032

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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.",

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AU - Liaukonyte, Jura

AU - Richards, Timothy

AU - Kaiser, Harry M.

AU - Rickard, Bradley J.

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N2 - 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.

AB - 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.

KW - Experimental economics

KW - Generic advertising

KW - Inequity aversion

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

Abstract

Keywords

ASJC Scopus subject areas

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