Whether social comparison affects individual well-being is of central importance for understanding behavior in any social environment. Traditional economic theories focus on the role of absolute rewards, whereas behavioral evidence suggests that social comparisons influence well-being and...

In this paper we study the role of absolute versus relative income using functional magnetic resonance imaging (fMRI). While being scanned in two adjacent MRI scanners, pairs of subjects had to simultaneously perform a simple estimation task that entailed monetary rewards for correct answers. We...