Equity Preferences in Relation to Culture

1. Equity Preferences in Relation to Culture Comparing India, Peru, and the US

2. Culture and Fairness • Concern for fairness appears universal • Ways people judge things to be fair differs across cultures • Studied in situations where people are asked to distribute resources • Recall the Ultimatum game, Dictator game, Prisoner’s dilemma, Public goods game, etc • What are the allocation rules used?

3. Allocation Rules • Equity • Based on individual contribution • Equality • Equal sharing regardless of contribution • Need • Based on who needs them the most • Reciprocity • ‘Tit for tat’, based on what others have done for you • Norms • What is generally accepted in society

4. Which Allocation Rule is Most Fair?

5. Berman et al (1985) • Scenario presented to Indian and American adults about how to distribute a bonus between two employees, one of whom had excellent work performance and an adequate economic situation and the other who had average work performance but a poor financial situation due to illness in the family. How should they divide the bonus money? • Find • USA predominant strategy is based on equity • India predominant strategy is based on need

6. Henrich et al (2010) • Looked at 15 mostly small scale societies, played the dictator game with a windfall resource of one day’s wage • Find • US responses were not typical, but were based on an equity notion of fairness • The perception of fairness based on equity was more common in market integrated societies (high market integration means a large proportion of food is bought in stores), and in societies where a world religion was practiced (Islam or Christianity).

7. Determination of Allocation Rules from Cultural Perspective • Personal Characteristics • What are the beliefs, values, experiences of the individual? Does the individual subscribe to cultural models of collectivism/individualism? • Situational Factors • Is the allocation being done in a work situation, family context, on basis of gender? Who is dividing resources and what is their relationship to the recipient? Different situations often result in different allocation rules even within the same cultural context • Nature of the resources • How scarce and valued are the resources being allocated?

8. Collectivism/Individualism • Cultural ways of understanding and structuring independence (autonomous being) and interdependence (connected with others) – Hofstede (1980) • Traditionally thought of as a dichotomy and applied to cultures, characterizing them as individualistic (primarily oriented toward individualistic), or collectivist (primarily oriented toward interdependence) • In contemporary theory cultures seen to be heterogenous, dynamic and complex • One or other may dominate, but usually both are important to some degree

9. Collectivism/Individualism • European-American considered individualistic • Promoting goals of self-expression, self-fulfillment, individual choices, defining self separate from others • All other cultures (Asian studied most) considered collectivist • Promoting goals of conformity, social cohesion, concern for others’ needs, pursuing group interests, defining self in relation to others

10. What Do We Know About India? • Traditional • Parents foster obedience, low independence, low innovation, perception of external control is high • Collectivist • Focus on maintaining interpersonal harmony, cooperation, sharing, concern for others • Caste system • Power differential is high, along the lines of caste, gender, age and seniority, stress obedience to authority, conformity to norms • Scarce resources • Families own few material resources, food is valued and scarce, perception of non-contingency in effort-outcome

11. What Do We Expect in Resource Allocation Strategies in India? • High preference for allocating according to need and equality • Because of the strong concern for maintaining interpersonal harmony and in concern for others • High preference for self-interest strategy of allocation • Because of scarcity of the resource (in this case candy) • Low preference for merit-based allocation such as equity • Perception that effort does not coincide with gain – eg, may work hard in agriculture and lose all in floods • The rule applied likely differs depending on the situation (eg., work, family, power differential – caste, elder, gender)

12. What Do We Know About Peru? • Between Traditional and Contemporary: Dynamic • Parents foster obedience, independence, perception of external control is high • Collectivist/Individualistic: Complex • Focus on maintaining interpersonal harmony, cooperation, sharing, concern for others, with strong drive to get ahead oneself • Power Differential • Power differential is high, along the lines of gender, age and seniority, stress obedience to authority, conformity to norms • Scarce resources • Families own modest material resources, food is valued and obtained through much effort, perception of contingency in effort-outcome, children have access to candy

13. What Do We Expect in Resource Allocation Strategies in Peru? • High preference for allocating according to equality • Because of the strong concern for maintaining interpersonal harmony and in concern for others • Low preference for self-interest strategy of allocation • Because resource (in this case candy) not scarce • High preference for merit-based allocation such as equity • Perception that effort does coincide with gain – eg, those who work hard are able to reap benefits

14. Exercise • With these introductions to the structures of the cultural settings (India, Peru) where the research was conducted, what would you predict about children who were dividing resources with another person in the following situations: 1) Ultimatum Game • one child gets windfall of candy and is asked to divide with another child who can accept the offer, or reject it (if rejected no one gets anything)

15. Exercise 2) Dictator Game • One child gets windfall of candy and divides with A) Unfamiliar child of same gender who has to accept B) Unfamiliar child of opposite gender who has to accept C) Friend who has to accept D) Parent who has to accept E) Sibling who has to accept

16. Exercise 3) What would you predict about children who were dividing resources in the Dictator Game with another child in the following situations: A) A majority of the candy is non-special, a few pieces are highly valued special candies B) The resource is a food staple that is highly valued by the parents but not by the child (eg., lentils) C) The resource is money (small coin – equivalent to a penny) • Children in India have very little experience at all with money • Children in Peru do have experience having pocket money

17. Exercise 4) Are our predictions based on cultural structures supported by our findings? A) INDIA B) PERU

18. Looking at Our Results

19. Rejections of DI in India Mean for age 6-7= 2 rejections/6 trials Mean for 8-9= 1.57 rejections/6 trials Our t-test was non-significant, telling us there is no difference between these age groups Conclusion: In this sample from India, children did not increase in rejections of DI as they aged

20. Rejections of AI in India Mean for age 6-7= 0.75 rejections Mean for age 8-9= 1.62 rejections Again, no significant difference was found Conclusion: In this sample from India, older children were not more likely to reject AI

21. Rejections of DI in Peru Mean for age 6-7= 2.63 Mean for age 8-9= 4.69 Our t-test was significant, meaning there is a difference between the older and younger children Conclusion: In this sample from Peru, older children rejected DI significantly more times than younger children

22. Rejections of AI in Peru Mean for age 6-7= 0.73 Mean for age 8-9= 1.00 Our t-test found no significant difference between these ages Conclusion: In Peru, older children were not more likely to reject AI than younger children.

23. Rejections of DI in India

24. Rejections of AI in India

25. Rejections of DI in Peru Note: Significant Difference

26. Rejections of AI in Peru

27. Total DI Rejections Mean for India= 1.75 Mean for Peru= 3.52 Our t-test revealed a significant difference between the two countries Conclusion: Peruvian children rejected more DI trials than did Indian children

28. Total AI Rejections Mean for India= 1.20 Mean for Peru= 0.88 Our t-test showed no significant difference between countries Conclusion: Peruvian and Indian children did not differ in their rejections of AI.

29. DI Rejections across Cultures • Rejecting DI: • U.S. : Increases with age • Peru: Increases with age However: • India: Stays relatively low across ages

30. DI Rejections across Cultures

31. AI Rejections across Cultures • Rejecting AI: • U.S.: Significant increase around age 8 However: • Peru: Stays relatively low across ages • India: Stays relatively low across ages

32. AI Rejections across Cultures

33. Overall Findings • For DI, Peru follows the trend of the US • When they are getting the bad end of the deal, rejections increase with age. • India does not follow this trend; they show low rejections of DI regardless of age. • For AI, Peru and India do not follow the trend of the US. • In the US, AI rejections increased significantly at age 8 • Peruvians and Indians rarely rejected trials that were in their favor, regardless of age