When are Women More Generous than Men

I. INTRODUCTION Gender's impact on behavior and decision making continues to be a topic of much debate and scrutiny. As evidence one need look no further than the firestorm stemming from comments by Lawrence Summers, the president of Harvard University, about the potential role that gender differences play in academia. (1) There is considerable experimental evidence that behavior varies with gender. For example, Gneezy and Rustichini (2004) find that by the time they are 9 years old, boys are already more competitive than girls. Harbaugh et al. (2005) find that by fourth grade boys are more confident about their own abilities. Neiderle and Vesterlund (2005) report a similar difference for college students. (2) The real impacts of gender differences are wide-ranging. Rask and Tiefenthaler (2004) examine the gender gap in undergraduate economics majors. They find that female students are more responsive to their grades in principles classes when deciding whether to enroll in advanced economics courses than their male counterparts are, which could explain why average GPAs are typically higher for female economics majors. Understanding gender differences not only affects how one approaches social issues such as why relatively fewer women pursue careers in the hard sciences (Summers's controversial question), but it can have strategic effects as well. Should a firm send a male or a female representative to handle a bargaining negotiation with a supplier? What about negotiating a dispute within the finn? Based on a field experiment, Landry et al. (2005) find that contributions to a public good are higher when the solicitor is an attractive female. This could suggest that women should lead high-profile charity fundraising. In a National Public Radio interview, Helen Fischer argued that more businesses are trying to understand the "natural talents" of women and maintained that those businesses that do know how to use this "resource" are "winning." (3) Several laboratory studies have found significant gender differences even in simple games; however, apparently contradictory evidence exists as to the magnitude and direction of these gender differences. (4) This article compares behavior across genders for two basic allocation decisions that have been widely studied in the laboratory: a dictator game and a trust game. (5) In a dictator game, the allocation decision stands alone, whereas the allocation decision is preceded by another person's action in the trust game. In the trust game a player could be faced with the same allocation decision as a dictator but only as the result of another person's decision. Observed behavioral differences between these two decision contexts can be used to identify reciprocal behavior (see Cox 2004; Cox and Deck 2005). The difference between being a dictator and responding to the action of another may alter behavior as the opportunity to act reciprocally could increase the subjective payoff of a jointly beneficial money payoff outcome. Other factors that have been found to influence behavior include social distance and the payoff level. Hoffman et al. (1994) and Cox and Deck (2005) show that varying the social distance involved in the experimental protocol can cause economic agents to choose differently over the same set of monetary outcomes. A low social distance, in which agents' identities are more closely associated with their actions, increases the social cost of selfish behavior. Behavioral effects from situational features, such as the ability to reciprocate, and the social distance are consistent with an economic model that views decisions as not being based solely on monetary outcomes. Of course, the monetary stakes involved in the allocation decision are also a cost of being generous. Previous research examined the effects of gender in allocation games but led to mixed findings. In ultimatum games, Eckel and Grossman (2001) and Solnick (2001) find that males and females make identical offers, but Eckel and Grossman find that women are more willing to accept unfair offers and Solnick finds no second mover gender difference. …