Do great distance and discussion among dictators
facilitate self-interest of people?
- Experimental evidence from dictator games -Takehiro Itoi
Kazuhito Ogawaii
Akihiro Suzukiiii
Hiromasa Takahashiiv
Toru Takemotov
Research Group of Economics and Management
No. 2010-E03
2010.10i

Faculty of Business Administration, Ishinomaki Senshu University, E-mail:takehiro@isenshu-u.ac.jp
ii Faculty of Economics, Osaka Sangyo University, E-mail: kz-ogawa@eco.osaka-sandai.ac.jp
iii Faculty of Literature and Social Sciences, Yamagata University, E-mail:asuzuki@human.kj.yamagata-u.ac.jp
iv Faculty of International Studies, Hiroshima City University, E-mail: htaka@intl.hiroshima-cu.ac.jp
v Faculty of Economics, Tezukayama University, E-mail: takemoto@tezukayama-u.ac.jp

Do great distance and discussion among dictators facilitate
self-interest of people?
- Experimental evidence from dictator games Takehiro Itoa , Kazuhito Ogawab , Akihiro Suzukic , Hiromasa Takahashid,∗, Toru Takemotoe
October, 2010
a Faculty of Business Administration, Ishinomaki Senshu University, 1 Shinmito Minamisakai, Ishinomaki, 986-

8580, Japanb Faculty of Economics, Osaka Sangyo University, 3-1-1 Nakagaito Daito, Osaka 574-8530, Japanc Faculty of Literature and Social Sciences, Yamagata University, 1-4-12 Kojirakawa-machi, Yamagata 990-8560,

Japand Faculty of International Studies, Hiroshima City University, 3-4-1 Ozuka-Higashi, Asa-Minami, Hiroshima 731-

3194, Japane Faculty of Economics, Tezukayama University, 7-1-1 Tezukayama, Nara 631-8501, Japan

Abstract
The authors examine how an individual or a group makes a donation to thoseliving in a distant place by introducing three factors into experiments of the standard
dictator game. The ﬁrst factor is group decision making or individual decision making.
The second factor is a dictator is in the same place as the recipient or in a distant place.
As the third factor, a subject with a ﬁxed role (dictator or recipient) plays the gamein three rounds. In each round, group members are exchanged with other dictator
subjects in the group dictator experiment. The original ﬁndings in this paper are as
follows. A dictator group or an individual dictator donates more to a neighborhood
than to a distant recipient. The more experiences that the dictators accumulate ingroup decision making, the more selﬁsh they become. It is also conﬁrmed that a groupdictator donates less than an individual dictator.
Keywords: inter-regional transfer, dictator game experiments, group decision, distantplace, random matching
JEL classification number: C92, D63, D79∗

Corresponding author. Tel.: +81-82-830-1500. E-mail: htaka@intl.hiroshima-cu.ac.jp1

1

Introduction

This paper examines the eﬀects of reciprocity or altruism on inter-regional transfer expenditures in an area. As an example, many countries implement a ﬁnancial transfer system
to reduce the ﬁscal disparities among regions. One of the reasons for introducing sucha system is the fairness motivation (see Musgrave and Musgrave (1980)). However, it isimportant to know how this system aﬀects the welfare of the residents in the donor region,
as explained in the following. Suppose that the residents in the donor region contributethe same amount of money to two diﬀerent regions, X and Y. In this case, their welfare
may be higher when they donate to the residents in region X than when they donate to
the residents in region Y. Thus, the welfare in the donor region should be considered when
an inter-regional transfer system is designed.
Experiments using the dictator game are suitable for analyzing inter-regional transfer
expenditures. In this game, a rational or selﬁsh player would not distribute an amountof money to any kind of recipient. However, in most experiments, a certain proportionof the players do contribute a positive amount of money. Such behavior is interpreted as
altruism or reciprocity.
In an inter-regional transfer expenditure, the amount that the residents in the donor
region donate to the recipients depends on where the recipients live. For example, theresidents in the donor region may feel more familiar with the recipients living close tothem and may be willing to donate more money to them.
Nevertheless, there may be an emotional backlash between residents in two neighboring
places. The emotional backlash is less between distant places than between neighboring
places. In the case of a distant place, since there are few interests shared between residents
in both places, such feelings may not arise. Therefore, the residents in the donor region
may distribute more money to the residents in a distant place.
In an inter-regional transfer expenditure, the decision maker can be the local government. In other words, the decision making is not individual, although the residents inthe donor region must agree to the donation. Therefore, we analyze the eﬀect of groupdecision making. In addition, this decision making is not a one-time-only event because itis repeated. For this reason, we introduce three factors into the dictator game experiment:a distant place, group decision making, and repetition of the group decision with changesof the group members.1
1

Political decision makers often are replaced by the movement of residents or the result of a local
government election. Therefore, the same subjects participate in a group in only one round in our setting,and a new group is formed in the next round.

2

We form the following three hypotheses to examine the eﬀects of group decision making
and of a distant place. First, the donation rate of a dictator will be lower in a distant placefrom a recipient than in the same place as a recipient. We regard the distance between
a certain place and another place as one of the forms of social distance. Reciprocity may
decline, because the dictator’s place is distant from the recipient’s place. Second, thedonation rate will be lower in the case of a group decision than in the case of an individual
decision. We check this hypothesis in a diﬀerent way than that of Luhan, Kocher, andSutter (2009). Third, one may be inﬂuenced by other people’s opinion or decision-making
process. A person is likely to change his/her opinion as the number of people advisinghim/her increases. Thus, in the third hypothesis, when a dictator has more opportunities
to negotiate donations with other dictators, he/she donates less to his/her recipient.
Examining these hypotheses, we conduct two experiments: one is an individual dictator game, and the other is a group dictator game. Every experiment consists of four
treatments, based on the distance between the dictator and the recipient. Each treatment
consists of three rounds. In all the treatments, the role of a subject is ﬁxed throughout
the treatment. All the treatments were conducted in two places in Japan, Hiroshima
and Yamagata. Hiroshima is approximately 800 kilometers away from Yamagata and thehuman interaction between both places is almost nonexistent. In two of the treatments,
a dictator (a dictator group) makes a decision whether to donate his or her (its) money
to a recipient living in the same place as the dictator. That is, the dictator (a dictatorgroup) in Hiroshima (Yamagata) makes a decision whether to donate to the recipient inHiroshima (Yamagata). In the remaining two treatments, a dictator (a dictator group)
makes a decision whether to donate his or her money to a recipient living in a distantplace from the dictator. That is, the dictator (a dictator group) in Hiroshima (Yamagata)makes a decision whether to donate to the recipient in Yamagata (Hiroshima). Note thatin the group dictator experiments, all members of the group are replaced in every round.
This paper is organized as follows: In Section 2, we describe previous studies related
to our experiment. Section 3 provides the details of our experiment. Section 4 describes
the results of our experiment. Section 5 discusses various aspects of the results. Section 6
concludes the paper.

2

Related work

Since Kahneman, Knetsch, and Thaler (1986), there have been many papers on dictator
game experiments. Camerer (2003) presented a survey of some results. The main results
are as follows:3• In dictator game experiments, dictators give their recipients 13% to 50% of theirown endowments.
• Anonymity decreases the average donation rate.
• There is no diﬀerence in the average oﬀer rate between genders. However, female
dictators are easily inﬂuenced by the size of their own endowments.
Hoﬀman, McCabe, and Smith (1996) and Rankin (2006) studied how a “social distance” inﬂuences the donation rates in dictator game experiments. Hoﬀman et al. (1996)
conducted dictator games by using the double-blind method. In the experiment, Hoﬀman
et al. (1996) controlled the social distance not only between the dictator and the recipient
but also between the dictator and the experimenter and then examined the donation rate.
To change the social distance, the experimenter was not in the lab in an extreme treatment
or the experimenter put the rewards into an envelope in another treatment. They foundthat the nearer the social distance between the dictator and the experimenter, the higher
the donation rate.
Rankin (2006) examined the social distance between the dictator and the recipient. He
conducted dictator games in the 2×2 factorial design, in which one factor is communicability and the other is anonymity. Each treatment involved 8 rounds with random matching.
The donation rate was 6% in the anonymous and no-request treatment, 26.3% in the
anonymous and request treatment, 39% in the face-to-face and no-request treatment, and
27% in the face-to-face and request treatment. This indicates that a request from therecipient increases the donation rate in the anonymous case, but not in the face-to-facecase.
We found that Johannesson and Persson (2000) also studied the relation between a
distant place and a dictator’s behavior. They conducted dictator games in which thesubjects donated some money by mail to a person, who lived in Sweden and was selected
at random2 . In this experiment, one-third of the recipients donated positive amounts ofmoney. The diﬀerence between the donation rate in the above experiment and the donation
rate in a normal dictator game was not signiﬁcant. They concluded that the dictator
may donate positive amounts of money for a reason diﬀerent from the expectations ofreciprocity3 in the dictator game experiments because there is scarcely any expectationof reciprocity in this experiment. However, it should be noted that these researchers paid
2

The recipients had no ex-ante information about this experiment.
Expectations of reciprocity is an idea to explain the positive donation rates in dictator games. Whensubjects make a decision in an experiment, they take into account the possibility of ﬁnding a person who
learns of their decision in the experiment at a future time.
3

4

less attention to the physical distance and did not control the physical distance between
the dictator and the recipient.
Some experiments considered whether a group decision is more rational than an individual decision. Kocher and Sutter (2005) examined repeated beauty-contest game experiments and found that the number selected is smaller in the group treatment than in theindividual treatment. Sutter (2005) also conducted repeated beauty-contest game experiments and showed that the larger the group size is, the smaller the number they choose.
Rockenbach, Sadrieh, and Mathauschek (2007) reported that the choices of lotteries bygroups are consistent with the portfolio selection theory. Bornstein, Kugler, Budescu, andSelten (2008) conducted repeated price-competition game experiments and obtained theresult that the group sellers choose lower prices than do the individual sellers.
In particular, Cason and Mui (1997) and Luhan et al. (2009) examined whether thedecision of the dictator group is more selﬁsh than that of the individual dictator.4 Casonand Mui (1997) conducted dictator games in which a dictator group consisted of two
subjects and examined the group polarization. Group polarization means that the groupdecision becomes more radical than the individual decision. According to these researchers,
there are two theories to explain group polarization. One is the persuasive arguments
theory (PAT) and the other is the social comparison theory (SCT). PAT states that thewinning arguments will tend to be more extreme in a group discussion.
SCT states that a person observes others’ opinions to evaluate his or her opinion andtries to make an idealized decision. In experiments, each seller group forced a buyer tobuy a good for the price that the seller group decided freely. The time limit to decide theprice was ﬁve minutes. Cason and Mui (1997) showed that a group of altruistic individuals
makes an other-regarding decision. They concluded that their result supported SCT.
Luhan et al. (2009) conducted dictator games of three rounds. In the ﬁrst and thethird rounds, an individual dictator game was played. In the second round, three subjects
formed a group and participated in the group dictator game. After every round, theexperimenter announced the existence or non-existence of a next round. The average
donation rate was 19, 11, and 13% in the ﬁrst, second, and third round, respectively. The
diﬀerence between the ﬁrst and the third rounds was signiﬁcant but the diﬀerence between
the second round and the third round was not signiﬁcant. They concluded that the groupdecision is more selﬁsh than the individual decision and the group decision making shifts
the individual’s attitude toward being more selﬁsh.

4

Dufwenberg and Muren (2006) examined the relation between the other-regarding behavior and thegender.

5

The method of communication in Cason and Mui (1997) was face to face. This study
concluded that the group decision making is less selﬁsh than the individual decision making. However, the method in Luhan et al. (2009) was an online chat. This study concluded
that the group decision making is more selﬁsh than the individual decision making. According to Luhan et al. (2009), whether the group decision making is more selﬁsh than
the individual decision making depends on anonymity.

3

Experiment

The following three hypotheses are tested to answer our research questions.
Hypothesis I:

The donation rate of a dictator is lower in the distant place from arecipient than in the same place as a recipient.

Hypothesis II:

The donation rate is lower in the case of a group decision than in thecase of an individual decision.

Hypothesis III:As a round goes on, the group decision becomes more selﬁsh than thatin the previous round.

The hypotheses are not consistent with classical economic theory. In other words, rationaland selﬁsh subjects would not donate any amount.

3.1

Experimental design

Table 1: Experimental proﬁle: Design of group and individual experiments. First letterand second letter “H (irhosima)” or “Y (amagata)” indicate the place of the dictator andthe place of the recipient, respectively.
Same\distance place as Dictator’s place Hiroshima Yamagata
Same place
HH
YY
Distant place
HY
YH

There are two experiments in this paper. One is an individual dictator game experiment, and the other is a group dictator experiment.
The individual dictator game experiment consists of four treatments, and the diﬀerenceof each treatment is where the dictators and the recipients are, as Table 1 indicates. “H”
indicates that the subjects are in Hiroshima City and “Y” indicates that the subjects arein Yamagata City. For example, in treatment HY, the dictators are in Hiroshima and therecipients are in Yamagata.
The experimenters randomly gave each subject in HH and YY the role of either dictatoror recipient at the beginning of the experiment. A subject in Hiroshima and Yamagata

6was assigned the role of dictator in treatments HY and YH, respectively. As in the related
studies, the dictators were in a diﬀerent room from the recipients in treatments HH and
YY. The roles given to the subjects did not change during a treatment but the dictator
was randomly matched with the recipient in each round. The subjects in the dictator role
were informed about this in the instructions. The experimenters carried out the dictator
game for three rounds in each treatment, although they actually told the subjects thatthe game would be repeated for several rounds. The experimenters gave each subject inthe dictator role JPY800 as the endowment in each round.5 The experimenters requested
that each dictator subject should decide the amount of money donated to the recipient
paired with the dictator.
In the group dictator experiment, the procedure was almost the same as that of theindividual dictator game experiment. The diﬀerences in the procedures between the two
experiments are as follows. A decision maker was not an individual subject but a groupof three subjects. The experimenters randomly reconstructed each dictator group andrecipient group in each round. The experimenters gave each subject in the dictator role
JPY800, that is, the total endowment of one dictator group was JPY2400 in each round.
The experimenters requested that the subjects in the dictator group come to an agreementof the amount of money donated to the recipient group that was paired with that dictatorgroup.6 The subjects in each dictator group adjusted their opinion of the amount of money
through a ﬁve-minute online chat.
Our dictator game experiments are diﬀerent from typical dictator games in that therecipients are in a place far away from the dictators in some treatments.7 Furthermore,
our dictator game experiment is diﬀerent from Luhan et al. (2009) in the following point.
In Luhan et al. (2009), the subjects in the dictator role in the dictator game played a groupdictator game after they had played the individual dictator game. In our experiments,
one set of subjects participated in the group dictator game experiment and another set of
subjects participated in the individual dictator game experiment.

3.2

Overview

The two experiments were carried out at Hiroshima City University and Yamagata University from October 2007 to December 2009. Each treatment took approximately 100
5JPY800 ranged from USD7 to USD9 in the exchange rate at that time.
Each recipient group would receive the money from the dictator group that was paired with therecipient group, and the money would be equally divided among the subjects in the recipient group. The
experimenters decided not to pay the subjects in a dictator group any reward if they failed to agree on theamount of money, although the experimenters did not encounter this situation.
7
We experimented in Hiroshima City and Yamagata City, which are a distance of eight-hundred kilometers apart. Traveling between these cities distance takes ﬁve hours or longer.
67

minutes to complete. In the group dictator game experiment, 54 undergraduate students
at Hiroshima City University and 48 undergraduate students at Yamagata University participated in the dictator role. In the same experiment, 15 and 16 undergraduate students
participated at Hiroshima City University and Yamagata University, respectively, in therecipient role. In this experiment, a recipient received a donation from three diﬀerent
groups in each round. Therefore, a recipient belonged to three recipient groups. This
was not told to the subjects in the dictator role. Each subject of the dictator role could
participate in only one treatment.
In the individual dictator game experiment, 40 undergraduates at Hiroshima City
University and 38 undergraduates at Yamagata University participated in the dictatorrole and the same numbers of the undergraduates participated in the recipient role. The
amount of money paid to the subjects ranged from JPY 0 to JPY 2400.8 We used a copyof z-Tree（Fischbacher (2007)) as the application software for the experiment. In the HY
and YH treatments, the z-Tree server was set up at Yamagata University and each z-Leaf
was connected to the server via the Internet.
The following are details of the interaction between the dictators (or dictator groups)
and recipients (or recipient groups). In treatments HH and YY in both experiments, thesubjects in the dictator role entered a diﬀerent room from that of the subjects in therecipient role, and so the dictators did not come in contact with any recipients before,
during, or after a treatment.

4

Experimental results

In this section we verify the three hypotheses and calculate some results statistically.
Before conducting the statistical analyses, we summarize the outcomes of our experiments
below.

4.1

Data summary

For the analysis, we utilize three kinds of data. Data A is the individual decision-making
result in the individual dictator game experiment. Data B is the group decision-making
result in the group dictator game experiment. Data C is the individual decision-making
result in the group dictator game treatment, which divides data B individually. Let us
8

To keep the chat rule, each subject of the recipient role observed the online chat in all of the treatments,
although the observed chat was not that of the paired dictator group. The experimenters did not informthe subjects in the dictator role that the subjects in the recipient role were observing them, although theexperimenters did inform the subjects in the dictator role that somebody would be observing their chat.
To increase the reward to the subjects in the recipient role, the experimenters paid JPY 1000 per subject
to each in this role as a reward for this work. The subjects in the dictator role did not know the recipientswere paid this ﬁxed reward.

8

merge data A and B into “Decision Maker’s Data” and data A and C into “Individual
Data.”
Tables 2 and 4.1 summarize data A and data B, respectively. In these tables, the ﬁrst,
second, and third lines indicate the number of observations, the average donation rate,
and the standard deviation of the donation rate, respectively.9
Table 2: Summary of data A: the individual dictator game experiment.
Treatment
Round 1 Round 2 Round 3 Total
Number of observations
21
21
21
63
HH
Average donation rate
0.243
0.203
0.233
0.226
Standard deviation
0.227
0.208
0.233
0.220

HY

Number of observations
Average donation rate
Standard deviation

19
0.187
0.214

19
0.126
0.171

19
0.161
0.198

57
0.158
0.193

YY

Number of observations
Average donation rate
Standard deviation

15
0.238
0.188

15
0.245
0.193

15
0.245
0.190

45
0.243
0.186

YH

Number of observations
Average donation rate
Standard deviation

23
0.217
0.198

23
0.228
0.208

23
0.266
0.246

69
0.237
0.216

These tables show that it is important whether a dictator is in the same place as
his/her recipient. Table 4.1 tells us that as a round goes on, the donation rate and its
standard deviation decrease in the group dictator game experiment. In contrast, Table 2
tells us that the round as a variable has no eﬀect on the oﬀer rate in the individual dictator
game experiment.

4.2

Econometric analysis

For the examination of Hypothesis I, we conducted a random-eﬀects Tobit analysis for the
donation rate of data A because data A is panel data. We conducted the Tobit analysis
for the donation rate of data B because all the members are replaced in each round in thegroup dictator game treatments. 10 Tables 4 and 5 summarize the regression results. In
these tables, the variables are deﬁned as follows. SP is the same place dummy. Whendictators are in the same place as their recipients, it is 1; otherwise, it is 0. Y D is the
Yamagata dictator dummy. When dictators are in Yamagata, it is 1; otherwise, it is 0. R2
9In Table 4.1, one group is excluded in the ﬁrst round of the YH treatment because not all members
understood the instructions of the experiment.
10Note that the donation rate lies in the interval [0, 1] and that all the groups in all the rounds are
diﬀerent because a group is newly formed in each round.

9Table 3: Summary of data B: the group dictator game experiment.
Treatment
Round 1 Round 2 Round 3 Total
Number of observations
9
9
9
27
HH
Average donation rate
0.163
0.132
0.052
0.116
Standard deviation
0.198
0.141
0.085
0.151

HY

Number of observations
Average donation rate
Standard deviation

9
0.134
0.179

9
0.052
0.054

9
0.013
0.022

27
0.068
0.117

YY

Number of observations
Average donation rate
Standard deviation

8
0.213
0.198

8
0.122
0.161

8
0.083
0.093

24
0.139
0.160

YH

Number of observations
Average donation rate
Standard deviation

7
0.116
0.192

8
0.047
0.087

8
0.008
0.022

23
0.054
0.121

is the second round dummy; when dictators donate in the second round, it is 1; otherwise,
it is 0. R3 is the third round dummy. When dictators donate in the third round, it is 1;
otherwise, it is 0. GE is the gender dummy. When a dictator is male, it is 1; otherwise,
it is 0.
Table 4: The random-eﬀects Tobit analysis of the individual dictator game experiment.
Variable Coeﬃcient Std. Err.
Dependent variable: oﬀer rate
SP
0.108†(0.056)∗YD
0.130(0.057)R2-0.029(0.020)R3
0.002(0.020)∗∗GE
0.162(0.061)
Intercept -0.027(0.076)Signiﬁcance levels: † : 10%, ∗ : 5%, ∗∗ : 1%

Table 5: The Tobit analysis of the group dictator game experiment.
Variable Coeﬃcient Std. Err.
Dependent variable: oﬀer rate
SP
0.113∗∗(0.043)YD-0.014(0.043)R2-0.099†(0.051)∗∗R3-0.194(0.053)
Intercept
0.069(0.046)Signiﬁcance levels: † : 10%, ∗ : 5%, ∗∗ : 1%10

To examine Hypothesis II, we divide the Decision Maker’s Data into six groups depending on the round and on whether SP is equal to 1 and conduct Tobit analyses forthe donation rate of all the data groups (Tables 6 to 11). In these tables, the variable G
is the group decision dummy. It is 1 when a dictator is a group; otherwise, it is 0.
Table 6: The Tobit analysis of round 1 andthe same place (SP = 1) data.
Variable Coeﬃcient Std. Err.
Dependent variable: oﬀer rate
G-0.072(0.070)YD
0.025(0.066)∗∗
Intercept
0.213(0.048)

Table 7: The Tobit analysis of round 1 andthe distant place (SP = 0) data.
Variable Coeﬃcient Std. Err.
Dependent variable: oﬀer rate
G
-0.108(0.076)YD
0.009(0.067)∗∗
Intercept
0.168(0.054)Signiﬁcance levels: † : 10%, ∗ : 5%, ∗∗ : 1%

Signiﬁcance levels: † : 10%, ∗ : 5%, ∗∗ : 1%

Table 8: The Tobit analysis of round 2 andthe same place (SP = 1) data.
Variable Coeﬃcient Std. Err.
Dependent variable: oﬀer rate
G
-0.130†(0.068)YD
0.041(0.063)
Intercept
0.183∗∗(0.046)

Table 9: The Tobit analysis of round 2 andthe distant place (SP = 0) data.
Variable Coeﬃcient Std. Err.
Dependent variable: oﬀer rate
G
-0.193∗∗(0.072)YD
0.074(0.062)
Intercept
0.105∗(0.050)Signiﬁcance levels: † : 10%, ∗ : 5%, ∗∗ : 1%

Signiﬁcance levels: † : 10%, ∗ : 5%, ∗∗ : 1%

Table 10: The Tobit analysis of round 3 andthe same place (SP = 1) data.
Variable Coeﬃcient Std. Err.
Dependent variable: oﬀer rate
G
-0.242∗∗(0.072)YD
0.036(0.065)Intercept
0.202∗∗(0.047)

Table 11: The Tobit analysis of round 3 andthe distant place (SP = 0) data.
Variable Coeﬃcient Std. Err.
Dependent variable: oﬀer rate
G-0.369∗∗(0.095)YD
0.081(0.075)Intercept
0.132∗(0.060)Signiﬁcance levels: † : 10%, ∗ : 5%, ∗∗ : 1%

Signiﬁcance levels: † : 10%, ∗ : 5%, ∗∗ : 1%

Furthermore, we conducted a random-eﬀects Tobit analysis for the donation rate of
the Individual Data. Table 12 summarizes the results of the regression. In this table,variable I is the individual decision dummy. It is 1 if the experiment is the individual
dictator game; otherwise, it is 0.11

We set I ∗ Y D as the independent variable because the coeﬃcient of Y D is signiﬁcant in Table 4 andinsigniﬁcant in Table 5. Similarly, we set G ∗ R2 and G ∗ R3 as the independent variables because thecoeﬃcients of R2 and R3 are signiﬁcant in Table 5 and insigniﬁcant in Table 4.
1111

Table 12: The random-eﬀects Tobit analysis of the Individual Data.
Variable Coeﬃcient Std. Err.
Dependent variable: oﬀer rate
SP
0.091∗∗(0.029)G-0.043(0.041)
†
I ∗YD
0.074
(0.044)R2-0.029(0.024)R3
0.002(0.024)∗G ∗ R2-0.072(0.033)G ∗ R3-0.200∗∗(0.034)∗∗
Intercept
0.116(0.037)Signiﬁcance levels: † : 10%, ∗ : 5%, ∗∗ : 1%

Variable
SP
YD
R2
R3
G
I
GE

4.2.1

Table 13: Variable list for the econometric analysis.
Explanation
1 if a dictator is in the same place as a recipient; otherwise, it is 0.
1 if a dictator is in Yamagata; otherwise, it is 0.
1 for round 2; otherwise, it is 0.
1 for round 3; otherwise, it is 0.
1 for group dictator game experiment; otherwise, it is 0.
1 for individual dictator game experiment; otherwise, it is 0.
1 if a dictator is a male; otherwise, it is 0.

Eﬀect of “distant place”

Hypothesis I is supported since the coeﬃcient of SP is positive and weakly signiﬁcant (p <.10) in Table 4 for the individual dictator game experiment, and positive and signiﬁcant(p < .05) in Table 5 for the group dictator game experiment. Furthermore, SP is positiveand signiﬁcant (p < .01) in Table 12.
4.2.2

Eﬀect of “group decision making”

Tables 6 to 11 indicate that the coeﬃcients of G are negative and signiﬁcant for rounds
two and three (p < .10 for round two and SP = 1 and otherwise, p < .01). Furthermore,in Table 12, G ∗ R2 and G ∗ R3 are negative and signiﬁcant while G is insigniﬁcant. Hence,
Hypothesis II is supported for rounds two and three. This is in agreement with the resultof Luhan et al. (2009).
4.2.3

Eﬀect of “iteration of group decision making”

In Table 5, the coeﬃcients of R2 and R3 are negative and signiﬁcant and the coeﬃcientof R3 is smaller than the coeﬃcient of R2, while this is not observed in Table 4 for theindividual dictator game experiment. In a similar way, in Table 12, the coeﬃcients ofG ∗ R2 and G ∗ R3 are negative and signiﬁcant and the coeﬃcient of G ∗ R3 is smaller12than the coeﬃcient of G ∗ R2, while the coeﬃcients of R2 and R3 are insigniﬁcant. Hence,
Hypothesis III is supported.
4.2.4

Other results

In Table 4.1, the standard deviation of the donation rate in the group dictator game experiment decreases. Bartlett’s test supports the diﬀerent variances among the rounds at
a signiﬁcance level of 1% for YH and 10% for HH and HY. For treatment YY, Bartlett’s
test supports the diﬀerent variances between rounds one and three at a 10% signiﬁcance.
However, this is not observed in the individual dictator game experiment (Table 2). Furthermore, Table 5 shows that the coeﬃcients of Y D and GE are signiﬁcant.

5

Discussion

5.1

Does the exchange of opinion decrease the donation?

We compare the group and the individual dictator game experiments with Cason and Mui(1997) and Luhan et al. (2009). In the studies of Luhan et al. (2009), an online chatprogram was used for the procedure of decision making in a group to preserve anonymity.
Our study is diﬀerent from Luhan et al. (2009) in that the group decision was repeatedthree times and each group has a diﬀerent subject in each round.
Our comparison results are as follows. First, a group is more selﬁsh than an individualin the second and third rounds. This result is consistent with Luhan et al. (2009). Secondand more importantly, as the round goes on, the group decision becomes more selﬁsh thanin the previous round,12 although the same is not true for the individual decision.
This result may provide a clue to learning why a group is more selﬁsh than an individual. We think that the exchange of opinions is the key. In our experiment, the subjects
have more opportunities to exchange opinions as the round goes on because a group member is reshuﬄed in each round. Also, the exchange of opinions disperses “something” todiscourage the donation (e.g., expectations of reciprocity or preference) and this dispersal
makes the group decision more selﬁsh. With regard to the expectations of reciprocity, theexample below is one of many possibilities.
It is pointed out that one of the reasons why a dictator gives money to a recipientis the expectation of reciprocity.13 However, the expectation of reciprocity is controlled
to zero in the ordinal dictator game experiments. Yet, decisions are made with an over12

This change may be related to SCT or PAT in the ﬁeld of psychology. However, SCT and PAT do not
imply the decline of the donation of a dictator group.
13
See Hoﬀman et al. (1996). However, Johannesson and Persson (2000) concludes that the dictators
donate to the recipient even if there is no expectation at all of reciprocity.

13estimated expectation in the one-shot individual dictator game experiment because theaverage donation rate is signiﬁcantly positive. As our results indicate, even if the individual
dictator game is repeated, the over-estimated expectation may be preserved because of
the positive donation in our experiments. In contrast, when a group member is reshuﬄedin each round and group decisions are repeated, the subjects learn the true expectationof reciprocity by listening to various subjects’ opinions. That is, the exchange of opinions
disperses the knowledge about the true expectation of reciprocity. Of course, it is also
possible that the exchange of opinions disperses the same particular preference. Additional
research is needed to conﬁrm our thought.

5.2

Exploring the behavior of the egalitarian

Another question arises from the comparison between data A (Section 4), that of theindividual game experiment, and data C (Section 4), the individual data in the groupdictator game experiment. The question is whether an egalitarian subject of the groupdictator game experiment changed his/her opinion to a selﬁsh one. An egalitarian subject
is a subject who donates at least half of the endowment irrespective of his/her recipient’s
place.
Let us focus on the decision making in the individual dictator game experiment toclassify the type of subjects. From the comparison between the distant place and thesame place treatments of this experiment, it is highly possible that there are three notabletypes of people.
The ﬁrst is the egalitarian type. Approximately 5% of the subjects continued to
donate more than half of the endowment in all rounds in the distant place treatmentof the individual dictator game experiment. It is highly unlikely that they donated lessmoney to a recipient in the same place as themselves because of the results in Section 4.
Hence, it is highly possible that these subjects are egalitarians. If this type is deﬁned in
the weaker sense that one donates more than half of the total endowment, it is highly
possible that approximately 10% of the subjects in the distant place treatment of theindividual dictator game experiment belong to this type.14
The second is the selﬁsh type. The subject of this type never donates irrespectiveof his/her recipient’s place. In our experiment, approximately 11% of the subjects neverdonated in the same place treatment of the individual dictator game experiment (seeTable 14). Additionally, as indicated in the results in Section 4, the subject tended to
14

The egalitarians were observed in the dictator game experiments with the double-blind scheme. See
Hoﬀman et al. (1996) and Johannesson and Persson (2000). Furthermore, the egalitarians were also
observed in lost-wallet game experiments. See Charness, Haruvy, and Sonsino (2007).

14

donate more to the recipients in the same place than in the distant place. Taking theseresults into account, these subjects would not donate at all, even if they participated in
the distant place treatment. Hence, it is highly possible that they belong to the selﬁshtype.
The third is the budging type. This type of subject donates to a neighborhood morethan to a distant recipient. Approximately 17% of the subjects never donated in the
distant place treatment of the individual dictator game experiment. Because a subject’s
participation in the same place treatment or in the distant place treatment was assigned
randomly, it is conceivable that approximately 17% of the subjects in the same place
treatment would never donate in the distant place treatment if they had been assigned toparticipate in the distant treatment. However, since 11% of the subjects never donatedin the same place treatment of the individual dictator game treatment, it is likely that
6% of the subjects (17% − 11%) would change their donating behavior and, thus, canbe regarded as the budging type.15 The subject of this type changes his or her donationaccording to the extent of the expectation of reciprocity. The lower the expectation ofreciprocity is, the less they donate. The diﬀerence between the two treatments of theindividual dictator game experiment is due to the budging type of subject.
In data C, no egalitarians were observed even in the weak sense.16 It might be expectedthat there would be a few egalitarian subjects in the group dictator game experiment,
because approximately 5% of the subjects in the distant place treatment in the individual
dictator game experiment were egalitarians. This result suggests that the egalitarian
subject changed his or her opinion to a selﬁsh one through the exchange of opinions withother subjects. However, it is also possible that the budging subjects learned the true
expectation of reciprocity by listening to others’ opinions and that they began to behave
selﬁshly. As a result, the subjects with selﬁsh behavior became the majority in eachgroup, even if the egalitarian subject did not change his/her preference. We have no way
of ascertaining whether the egalitarian changed his/her opinion. However, whether anegalitarian changed his/her opinion to a selﬁsh one through the exchange of opinions withother subjects is an interesting question.

15
Needless to say, more than 6% of the subjects may belong to the budging type. Although the budging
type consists of those who donate more to the recipients in the same place than in the distant place, we
can only distinguish the percentage of subjects who seem to donate a positive amount of money to thesame place recipient but no money to the distant place recipient.
16
That is, no subjects donated more than half of the total endowment. See Table 15.

15

Table 14: Distribution of total donations in the individual dictator game.
Donation rate
0%
0–16.7%16.7–33.3%
33.3–50%
50–100%Same place
11%
33%
11%
31%
14%

Distant place
17%
31%
24%
19%
10%

The donation rate is the total donation rate of three rounds.

Table 15: Distribution of total donations in the group dictator game.
Donation rate
0%
0–16.7%16.7–33.3%
33.3–50%
50–100%Same place
6%
61%
31%
2%
0%

Distant place
25%
56%
19%
0%
0%

The donation rate is the total donation rate of three rounds.

5.3

Comparison between the distant and the same places

We compare the donation of the dictator whose recipient is in the distant place and the
dictator whose recipient is in the same place. Our comparison results indicate that the
dictator group and the individual dictator donate more in the same place treatment thanin the distant place treatment.
The dictator game experiment in Johannesson and Persson (2000) is similar to theexperiments in our study because both studies compare the distant place treatment andthe same place treatment in the individual dictator game experiments. However, their experiments are diﬀerent from this study in two ways. First, the recipients in the treatment
corresponding to our distant place treatment were randomly drawn from the Swedish general population. Second, all the treatments were conducted with the double-blind scheme.
In their experiments, the diﬀerence between the control treatment and the distant place
treatment was not signiﬁcant, unlike our result. Their results are interpreted below. Let
us focus on the expectations of reciprocity in their control treatment, which corresponds
to our same place treatment. Their control treatment was too low to ﬁnd the diﬀerence inthe donation rates of the budging subjects between the distant place and the same place
treatments, because both treatments were conducted with the double-blind scheme.

16

5.4

Some implications from our experiments

Our interest is to examine the inter-regional transfer expenditure experimentally. In general, we need to examine the experimental results carefully to apply them to policy decision. For example, though a recipient’s behavior does not have any eﬀect on a dictator
in a standard dictator game experiment, there are various interactions between a donor
and a recipient in the case of an inter-regional transfer system. Furthermore, we need tonote whether the outcome of the dictator game experiment is sensitive to an additional
condition. It is necessary to compare the result of the dictator game experiment to theresult of an ultimatum game experiment or public goods experiment to apply the resultof the dictator game experiments to policy decision. In the next paragraph, we present
one of many possibilities.
From the result that both a dictator group and an individual dictator donate more
to a neighborhood than to a distant recipient, it is possible that the disutility of interregional transfer can be reduced through an appropriate institutional design. The result
implies that a donor has the intention of making a higher donation to a neighborhood
than to a distant recipient. This can be interpreted as follows: when making a certain
amount of donation, it is more desirable for the donor to donate to a neighborhood than
to a distant recipient. That is, in the case of an enforced inter-regional transfer througha tax, the transfer among relatively narrow regions may reduce the disutility of residents
in a high-income area. Because the donor is not likely to meet the distant recipient orlacks a sense of intimacy with the distant recipient, the donor feels a reduced expectationof reciprocity. This is the reason that the donation rate is higher in the same place
treatment than in the distant place treatment. Therefore, the following may be eﬀective
for improving the welfare of the donor residents and for increasing the donation to the
distant residents: the promotion of the liquidity of residency and the transmission ofregional information. The promotion of the liquidity of residency shortens the sense of
distance among groups, encourages a sense of intimacy, and raises the probability thatthe donor meets the recipient. The transmission of regional information also encourages
a sense of intimacy.

6

Conclusion

In this paper, we examined (1) the diﬀerence between the donation to a distant recipient
and the donation to a neighborhood and (2) the eﬀect of group reconstructing and iterated decision making in the group decision. Our original ﬁndings are as follows. (1) A

17dictator group as well as an individual dictator donates more to a neighborhood than to a
distant recipient, and (2) as a round goes on, the group decision becomes more selﬁsh than
the group decision in the previous round. We also conﬁrm that, as Luhan et al. (2009)indicated, a group dictator donates less than does an individual dictator.
The reason why Hypothesis III (i.e., as the round goes on, the group decision becomes
more selﬁsh than that in the previous round) is supported was not fully analyzed. As
shown in the last section, we presume that the donation rate decreases because each subject
learns the true expectation of reciprocity or changes his or her preference by the exchangeof opinions with other subjects. To ﬁnd the answer, an experiment of group decision
making with ﬁxed members is required. In such an experiment, we would prevent eachsubject from coming in contact with others’ opinions except for the members of the groupto which he/she belongs. If the result of this additional experiment was diﬀerent from thetwo experiments in the current study, we would conclude that the random matching, bywhich each subject has a higher possibility of talking with other selﬁsh subjects, causes
the decrease in the donation rate.

Acknowledgments
This work was supported by a Grant-in-Aid for Scientiﬁc Research (C) (18530226).

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AppendixA

An Example Instruction

The following instructions were provided to the dictators in the HY treatment of the groupdictator game experiment.17

How to make decisions
You will belong to a group that consists of three people. Your group members will be
exchanged with others in this room in every round. Your partner group, which consistsof three people, will be anonymous and will be sitting in a room at Yamagata University.
Your partner group will change in every round.
17

The instructions were originally written in Japanese.

19This experiment consists of some number of rounds. In each round, you should do thefollowing.

• The experimenter will give you JPY 800. That is, the experimenter will give yourgroup JPY 2400 in total.
• You must decide whether to give some money to your partner group. The amountof money must be the same from each group member. To determine the amounts,
you can talk to the other members through the online chat. You can donate from
JPY 0 to JPY 2400 in total, or JPY 800 per capita, to your partner group. You
must come to an agreement on your donation amounts within ﬁve minutes.
• The computer console will display your initial endowment (JPY 800) in this round.
• You must enter the agreed donations. If you donate JPY y per capita, you will haveto enter y into your computer console and press the “OK” button.
• If the entered donation does not coincide with those of the other members, you cancorrect the value. (If you make a mistake three times, the rewards of all members
and your partner group in this round will become zero.)• Thus, your partner group receives 3y in total, and so each member of your partnergroup receives y.
• Your partner group does not have an endowment to donate to you. Therefore, they
do not make any decisions about donations to you.

Procedure of the online chat
You will talk about the amount of money to be donated through an online chat. The
chat lasts for ﬁve minutes. At the end, you will have agreed on how much you will give to
your partner group.
• You will NOT ask other members for his/her private information such as faculty,
university major, gender, age, etc.
• You will NOT input your personal information such as your faculty, university major,
gender, age, etc.
• You will NOT reveal what you said in the previous rounds.
• You must input the amount agreed on by you and your group members in the chat.
20

Monetary reward
Your monetary reward will be the sum of your remaining endowment in all the rounds.
In other words, if you donate JPY di to your partner, your monetary reward in this round∑will be JPY (800−di ). Therefore, your total monetary reward will be JPY ni=1 (800−di ).

21