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Inequality as a barrier to economic integration? An experiment
JournalArticle (Originalarbeit in einer wissenschaftlichen Zeitschrift)
 
ID 4655923
Author(s) Camera, Gabriele; Hohl, Lukas; Weder, Rolf
Author(s) at UniBasel Weder, Rolf
Camera, Gabriele
Hohl, Lukas
Year 2022
Title Inequality as a barrier to economic integration? An experiment
Journal Experimental Economics
Pages / Article-Number 1-29
Keywords Economic opportunity, Endogenous institutions, Globalization, Indefinitely repeated games, Social dilemmas
Abstract

International economic theory suggests that people should embrace economic integration because it promises large gains. But policy reversals such as Brexit indicate a desire for economic disintegration. Here we report results of an experiment of how size and cross-country distribution of gains from integration influence individuals’ inclination to cooperate to reap its intended benefits and to embrace or reject integration. The design considers an indefinitely repeated helping game with multiple equilibria and strategic uncertainty. The data reveal that inequality of potential gains neither affected behavior nor reduced support for economic integration. However, integration may lead to disappointing, unequally distributed welfare gains, undermining support for the policy. This suggests that to better assess integration policies, we should account for the spillover effects of integration on behavior. Miscalculating this behavioral aspect may undermine the intended development goals and motivate calls for dramatic policy-reversals.

Publisher Springer
URL https://link.springer.com/content/pdf/10.1007/s10683-022-09777-4.pdf?pdf=button
Full Text on edoc
Digital Object Identifier DOI https://doi.org/10.1007/s10683-022-09777-4
Additional Information Online first article, not yet assigned to an issue
   

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02/05/2024