title: Equity theory and fair inequality: a neuroeconomic study.
abstract: The present paper reports results from, to our knowledge, the first study designed to examine the neuronal responses to income inequality in situations in which individuals have made different contributions in terms of work effort. We conducted an experiment that included a prescanning phase in which the participants earned money by working, and a neuronal scanning phase in which we examined how the brain responded when the participants evaluated different distributions of their earnings. We provide causal evidence for the relative contribution of work effort being crucial for understanding the hemodynamic response in the brain to inequality. We found a significant hemodynamic response in the striatum to deviations from the distribution of income that was proportional to work effort, but found no effect of deviations from the equal distribution of income. We also observed a striking correlation between the hemodynamic response in the striatum and the self-reported evaluation of the income distributions. Our results provide, to our knowledge, the first set of neuronal evidence for equity theory and suggest that people distinguish between fair and unfair inequalities.
authors.affiliation: Department of Economics and The Choice Lab, NHH Norwegian School of Economics, N-5045 Bergen, Norway;
authors.forename: Alexander W
authors.initials: AW
authors.lastname: Cappelen
authors.affiliation: Department of Biological and Medical Psychology, University of Bergen, N-5009 Bergen, Norway; Department of Neurology, Section for Clinical Neurophysiology, Haukeland University Hospital, N-5021 Bergen, Norway;
authors.forename: Tom
authors.initials: T
authors.lastname: Eichele
authors.affiliation: Department of Biological and Medical Psychology, University of Bergen, N-5009 Bergen, Norway; Division of Psychiatry, Haukeland University Hospital, N-5021 Bergen, Norway; Department of Radiology, Haukeland University Hospital, N-5021 Bergen, Norway; KG Jebsen Center for Neuropsychiatric Disorders, University of Bergen, N-5009 Bergen, Norway; NORMENT, Center of Excellence, University of Oslo, N-0424 Oslo, Norway; and.
authors.forename: Kenneth
authors.initials: K
authors.lastname: Hugdahl
authors.affiliation: Department of Biological and Medical Psychology, University of Bergen, N-5009 Bergen, Norway; Department of Clinical Engineering, Haukeland University Hospital, N-5021 Bergen, Norway.
authors.forename: Karsten
authors.initials: K
authors.lastname: Specht
authors.affiliation: Department of Economics and The Choice Lab, NHH Norwegian School of Economics, N-5045 Bergen, Norway; erik.sorensen@nhh.no.
authors.forename: Erik Ø
authors.initials: EØ
authors.lastname: Sørensen
authors.affiliation: Department of Economics and The Choice Lab, NHH Norwegian School of Economics, N-5045 Bergen, Norway;
authors.forename: Bertil
authors.initials: B
authors.lastname: Tungodden
mesh_terms: D000328:Adult; D001921:Brain / Q000502:physiology*; D002421:Caudate Nucleus / Q000502:physiology; D006801:Humans; D007182:Income; D008297:Male; D018803:Models, Economic; D017072:Neostriatum / Q000502:physiology; D010100:Oxygen / Q000097:blood; D012959:Socioeconomic Factors; D055815:Young Adult
chemical_list: D010100:Oxygen
keywords: equity theory; fairness; inequality; striatum