797 research outputs found
The impact of relative position and returns on sacrifice and reciprocity: an experimental study using individual decisions
We present a comprehensive experimental design that makes it possible to characterize other-regarding preferences and their relationship to the decision maker’s relative position. Participants are faced with a large number of decisions involving variations in the trade-offs between own and other’s payoffs, as well as in other potentially important factors like the decision maker’s relative position. We find that: (1) choices are responsive to the cost of helping and hurting others; (2) The weight a decision maker places on others’ monetary payoffs depends on whether the decision maker is in an advantageous or disadvantageous relative position; and (3) We find no evidence of reciprocity of the type linked to menu-dependence. The results of a mixture-model estimation show considerable heterogeneity in subjects’ motivations and confirm the absence of reciprocal motives. Pure selfish behavior is the most frequently observed behavior. Among the subjects exhibiting social preferences, social-welfare maximization is the most frequent, followed by inequality-aversion and by competitiveness
A ‘threat’ is a ‘Threat’: Incentive effects of firing threats with varying degrees of performance information
We study the incentive effect of firing threats when bosses have limited information about workers. We show that a minimal amount of individual information about workers’ effort such as the time spent at their work station is sufficient to ensure strong incentive effects. This supports the use of firing threats based on rudimentary yet uncontroversial measures of work performance such as absenteeism, in organizational settings in which only limited information about workers is available. Our results help understand the limited link between pay and performance observed in compensation contracts calling for an extension of the principal-agent model to take into account how workers (mis-)perceive the intensity of incentives
Forward induction and entry deterrence: an experiment
The Dixit (Econ J 90:95–106, 1980) hypothesis that incumbents use
investment in capacity to deter potential entrants has found little empirical support.
Bagwell and Ramey (J Econ 27:660–680, 1996) propose a model where, in the unique game-theoretic prediction based on forward induction or iterated elimination
of weakly-dominated strategies, the incumbent does not have the strategic
advantage. We conduct an experiment with games inspired by these models. In the
Dixit-style game, the incumbent monopolizes the market most of the time even
without the investment in capacity. In our Bagwell-and-Ramey-style game, the
incumbent also tends to keep the market, in contrast to the predictions of an entrant
advantage. Nevertheless, we fin strong evidence that forward induction affects
the behavior of most participants. The results of our games suggest that players
perceive that the firs mover has an advantage without having to pre-commit
capacity. In our Bagwell–Ramey game, evolution and learning do not drive out this
perception. We back these claims with data analysis and a theoretical framework
for dynamics.Publicad
Communication, leadership and coordination failure
We investigate the limits of communication and leadership in avoiding coordination failure in minimum effort games. Our environment is challenging, with low benefits of coordination relative to the effort cost. We consider two leader types: cheap-talk leader-communicators who suggest an effort level, and first-mover leaders who lead by example. Both types of leadership have some ability to increase effort in groups with no history, but are insufficient in groups with a history of low effort. Using the strategy method for followers’ responses, we attribute the persistence of coordination failure to the presence of followers who do not follow the leader
Sequential two-player games with ambiguity
Author's pre-printIf players' beliefs are strictly nonadditive, the Dempster–Shafer updating rule can be used to define beliefs off the equilibrium path. We define an equilibrium concept in sequential two-person games where players update their beliefs with the Dempster–Shafer updating rule. We show that in the limit as uncertainty tends to zero, our equilibrium approximates Bayesian Nash equilibrium. We argue that our equilibrium can be used to define a refinement of Bayesian Nash equilibrium by imposing context-dependent constraints on beliefs under uncertainty.ESRC senior research fellowship scheme, H5242750259
The Emergence of Social Structure: Employer Information Networks in an Experimental Labor Market
The Effects of Social Ties on Coordination: Conceptual Foundations for an Empirical Analysis
International audienceThis paper investigates the influence that social ties can have on behavior. After defining the concept of social ties that we consider, we introduce an original model of social ties. The impact of such ties on social preferences is studied in a coordination game with outside option. We provide a detailed game theoretical analysis of this game while considering various types of players, i.e., self-interest maximizing, inequity averse, and fair agents. In addition to these approaches that require strategic reasoning in order to reach some equilibrium, we also present an alternative hypothesis that relies on the concept of team reasoning. After having discussed the differences between the latter and our model of social ties, we show how an experiment can be designed so as to discriminate among the models presented in the paper
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