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Albert Pratt Professor of Business and Government
Bohnet, Iris. "Informational Inequity Aversion and Performance." January 2016.
In labor markets, some individuals have, or believe to have, less data on the determinants of success than others, e.g., due to differential access to technology or role models. We provide experimental evidence on how informational differences translate into performance differences in competitive environments. In a laboratory tournament setting, we varied subjects’ information about the potential impact of a stochastic component on winning the tournament, and whether their competitor received the same or a different amount of information. We find that an informational disadvantage lowers performance only if subjects face a better informed counterpart. Thus, they exhibit informational inequity aversion.
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