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Keywords:

  • Interdependent preferences;
  • social welfare maximizing;
  • inequity aversion;
  • belief elicitation;
  • social information;
  • experiments;
  • mixture-of-types models
  • C72;
  • C91;
  • D81

Using data from modified dictator games and a mixture-of-types estimation technique, we find a clear relationship between a classification of subjects into four different types of interdependent preferences (selfish, social welfare maximizers, inequity averse, and competitive) and the beliefs subjects hold about others' distributive choices in a nonstrategic environment. In particular, selfish individuals fall into false-consensus bias more than other types, as they can hardly conceive that other individuals incur costs so as to change the distribution of payoffs. We also find that selfish individuals are the most robust preference type when repeating play, both when they learn about others' previous choices (social information) and when they do not, while other preference types are more unstable.