Title: The Cost of Belonging: Gift Exchange, Social Norms, and Inequality
Abstract: Gift-giving is a ubiquitous social practice, often occurring among people with very different economic resources. I study how reciprocity norms shape the distributional consequences of such exchange using a real-stakes, lab-in-the-field gift-giving experiment. I independently vary gift values and the resources of senders and receivers and elicit both perceived kindness and beliefs about the socially appropriate return. I find that appropriate returns rise strongly with the nominal value of the gift but adjust little to the sender’s economic sacrifice or the receiver’s ability to pay. Structurally estimating a model in which reciprocity responds to both kindness and social norms, I find that norms are the dominant force shaping reciprocal giving. These common reciprocity norms therefore impose substantially larger economic burdens on poorer participants and impose unequal costs of participating in social exchange. Counterfactual simulations show that such norms can also generate dynamic escalation in gift values. Norms that condition more strongly on economic means can reduce these distributional costs and improve equity while preserving social functions of gift exchange.
Sir Clive Granger Building糖心原创University Park Nottingham, NG7 2RD
telephone: +44 (0)115 951 5458 Enquiries: jose.guinotsaporta@nottingham.ac.ukExperiments: cedex@nottingham.ac.uk