Timing of Messages and the Aumann Conjecture: A multiple-Selves Approach

The Aumann (1990) conjecture states that cheap-talk messages do not necessarily help to coordinate on efficient Nash equilibria. In an experimental test of Aumann’s conjecture, Charness (2000) found that cheap-talk messages facilitate coordination when they precede the action, but not when they follow the action. Standard game-theoretical modeling abstracts from this timing effect, and therefore cannot account for it. To allow for a formal analysis of the timing effect, I study the sequential equilibria of the signaling game in which the sender is modeled as comprising two selves: an acting self and a signaling self. I interpret Aumann’s argument in this context to imply that all of the equilibria in this game are ‘babbling’ equilibria, in which the message conveys no information and does not affect the behavior of the receiver. Using this framework, I show that a fully communicative equilibrium exists—only if the message precedes the action but not when the message follows the action. In the latter case, no information is transmitted in any equilibrium. This result provides a game-theoretical explanation for the puzzling experimental results obtained by Charness (2000). I discuss other explanations for this timing-of-message effect and their relationship to the current analysis.pre-play communication, Nash equilibrium, coordination games, multiple selves

Trust, Social Capital and Economic Development

Many argue that elements of a society s norms, culture or social capital are central to understanding its development.However, these notions have been difficult to capture in economic models.Here we argue that trustworthiness is the economically relevant component of a society s culture and hence comprises its social capital.Individuals are trustworthy when they perform actions they have promised, even if these do not maximize their payoffs.The usual focus on incentive structures in motivating behaviour plays no role here.Instead, we emphasize more deep-seated modes of behaviour and consider that trustworthy agents are socialized to act as they do.To model this socialization, we borrow from a relatively new process of preference evolution pioneered by Bisin and Verdier (2001).The model developed endogenously accounts for social capital and explores its role in the process of economic development.It captures in a simple, formal way the interaction between social capital and the economy s productive process.The results obtained caution against rapid reform, provide an explanation for why late developing countries cannot easily transplant the modes of production that have proved useful in the West, and suggest an explanation for the pattern of reform experiences in ex-communist countries.technological change;public finance;economic development

Are people ethical? An experimental approach

Do ethical motivations and attitudes affect behaviour? We examine this issue in six Prisoner´s Dilemma and Prisoner´s Dilemma related games using an online experiment where individuals were asked to make choices and subsequently to express the motivations for their choices and their general attitudes. The experimental evidence of 1,701 students suggests that the motivations and attitudes of respondents regarding altruism, inequality aversion, reciprocity and aversion to lying are important for determining economic choices as well as self-interest. Econometric analysis of the choice to share indicates that ethical and self-interested motives are more important for determining choices than personal characteristics

The Influence of Hospitality Leaders’ Relational Transparency on Followers’ Trust and Deviance Behaviors: Mediating Role of Behavioral Integrity

This paper investigates the effect of leader\u27s relational transparency on follower organizational deviance through followers’ perception of leader\u27s behavioral integrity and their trust in leader. Multi-level modeling results from a multisource survey-based field-study with 24 hospitality student project teams (N = 149) show that behavioral integrity mediates the relationship between leader\u27s relational transparency and follower\u27s trust in leader. Furthermore, multi-level path analysis suggests that leader\u27s relational transparency, a team-level construct, exerts a cross-level effect on follower\u27s organizational deviance through the mediating roles of behavioral integrity and follower\u27s trust in leader. The study has yielded theoretical and practical implications that are useful for hospitality leaders. © 201

Modeling the kinetics of hybridization in microarrays

Conventional fluorescent-based microarrays acquire data after the hybridization phase. In this phase the targets analytes (i.e., DNA fragments) bind to the capturing probes on the array and supposedly reach a steady state. Accordingly, microarray experiments essentially provide only a single, steady-state data point of the hybridization process. On the other hand, a novel technique (i.e., realtime microarrays) capable of recording the kinetics of hybridization in fluorescent-based microarrays has recently been proposed in [5]. The richness of the information obtained therein promises higher signal-to-noise ratio, smaller estimation error, and broader assay detection dynamic range compared to the conventional microarrays. In the current paper, we develop a probabilistic model of the kinetics of hybridization and describe a procedure for the estimation of its parameters which include the binding rate and target concentration. This probabilistic model is an important step towards developing optimal detection algorithms for the microarrays which measure the kinetics of hybridization, and to understanding their fundamental limitations

The Power of Words: Why Communication fosters Cooperation and Efficiency

We present a game-theoretical model that accounts for abundant experimental evidence from games with non-binding communication (‘cheap talk’). It is based on two key ideas: People are conditionally averse to break norms of honesty and fairness (i.e., the emotional cost of breaking a norm is low if few people comply), and heterogeneous with regard to their concern for norms. The model explains (a) why cooperation in social dilemmas rises if players can previously announce their intended play, (b) why details of the communication protocol like the number of message senders and the order in which players communicate affect cooperation, (c) why players in sender-receiver games tend to transmit more information than a standard analysis would predict, and (d) why senders of false messages are often sanctioned if punishment is available.Communication; Cooperation; Fairness; Heterogeneity; Honesty; Reciprocity; Social Norms