We consider the cost of providing incentives using tournaments when workers are inequity averse and performance evaluation is costly. The principal never benefits from empathy to align incentives in a moral hazard framework between the workers, but he may benefit from their propensity for envy...

We expand upon the previous models of inequity aversion of Fehr and Schmidt [1], and Frohlich et al. [2], which assume that dictators get disutility if the final allocation of surplus deviates from the equal split (egalitarian principle) or from the subjects' production (libertarian principle)....

This paper applies the indirect evolutionary approach to study the evolution of inequality aversion in a simplified game of life. The game comprises a dilemma, a problem of coordination, and a problem of distribution as a general framework for the evolution of preferences. In singlegame...