Social Diversity Reduces the Complexity and Cost of Fostering Fairness

TL;DR

This paper explores how social diversity in populations impacts the complexity and cost of fostering fairness, revealing that diversity can simplify processes and reduce expenses in resource distribution systems.

Contribution

It introduces a model incorporating social diversity via heterogeneous graphs in the Ultimatum game, demonstrating how diversity reduces information needs and costs for fairness enforcement.

Findings

Diversity decreases the need for costly information gathering.

Certain influential individuals can be leveraged to lower fairness costs.

Lower fairness standards can further reduce institutional spending.

Abstract

Institutions and investors are constantly faced with the challenge of appropriately distributing endowments. No budget is limitless and optimising overall spending without sacrificing positive outcomes has been approached and resolved using several heuristics. To date, prior works have failed to consider how to encourage fairness in a population where social diversity is ubiquitous, and in which investors can only partially observe the population. Herein, by incorporating social diversity in the Ultimatum game through heterogeneous graphs, we investigate the effects of several interference mechanisms which assume incomplete information and flexible standards of fairness. We quantify the role of diversity and show how it reduces the need for information gathering, allowing us to relax a strict, costly interference process. Furthermore, we find that the influence of certain individuals, expressed by different network centrality measures, can be exploited to further reduce spending if minimal fairness requirements are lowered. Our results indicate that diversity changes and opens up novel mechanisms available to institutions wishing to promote fairness. Overall, our analysis provides novel insights to guide institutional policies in socially diverse complex systems.