Naïve Responses to Kind Delegation

Abstract

People do not like to delegate the distribution of favors. To explain this reluctance we disentangle reward motives in an experiment, in which an investor can directly transfer money to a trustee or delegate this decision to another investor. Varying the transfer values of investor and delegate, we find that the trustee’s rewards follow a rather simple pattern. In all situations, both investors are rewarded, but the person who ultimately decides gets a higher reward. Unlike studies on the punishment of delegated unkind decisions our results do not reveal sophisticated reward behavior that takes the responsibility of people into account.