Quarterly Journal of Economics Vol. 116 No. 1 2001
Status in Markets
Abstract
This project tests for the effect of social status in a laboratory experimental market. We consider a special “box design” market in which a vertical overlap in supply and demand ensure that there are multiple equilibrium prices. We manipulate the relative social status of our subjects by awarding high status to a subset of the group based on one of two procedures. In the first, a subject's score on a trivia quiz determines his or her status; in another, subjects are assigned randomly to a higher-status or lower-status group. In both treatments we find that average prices are higher in markets where higher-status sellers face lowerstatus buyers, and lower when buyers have higher status than sellers. Across all sessions, the higher-status side of the market captures a greater share of the surplus, earning significantly more than their lower-status counterparts.
- DOI
- 10.1162/003355301556374
- Volume
- 116
- Issue
- 1
- Pages
- 161-188
- Language
- en
- Sources
- bibtex:phds-export.bib openalex crossref