Resource Allocations and Disapproval Voting in Unequal Groups

Resources are often allocated in groups through decentralized nonmarket mechanisms. We experimentally investigate groups where a rich representative allocates resources among poorer members, who can announce disapproval by voting for a measure hurting the representative. We examine the effect of inequality aversion by keeping information on the allocation private in one and commonly known in another condition. Further, we investigate whether casting votes publicly or secretly influences allocation and voting behavior. We find that disapproval rates are highest with secret voting or a commonly known resource allocation. Disapproval voting fails to stimulate representatives to appear more prosocial, but rather induces them to keep everything. Private information on the allocation and public voting leads to least disapproval and exclusion of the poorest group members from the resources. The analysis shows that inequality aversion of poorer group members crucially interacts with the investigated institutional and informational details of the resource allocation situation.