(When) Would I Lie To You? Comment on ?Deception: The Role of Consequences?

This paper reconsiders the evidence on lying or deception presented in Gneezy (2005,American Economic Review). We argue that Gneezy?s data cannot reject the hip?esis that people are one of two kinds: either a person will never lie, or a person will lie whenever she prefers the outcome obtained by lying over the outcome obtained by telling the truth. This implies that so long as lying induces a preferred outcome over truth-telling, a person?s decisi? of whether to lie may be completely insensitive to other changes in the induced outcomes, such as exactly how much she monetarily gains relative to how much she hurts an anonymous partner. We run new but similar experiments to those of Gneezy in order to test this hypothesis. We find that our data cannot reject this hypothesis either, but we also discover substantial differences in behavior between our sub jects and Gneezy?s sub jects.experimental economics, lying, deception, social preferences

Implementation with Evidence: Complete Information

We study full-implementation in Nash equilibrium under complete information. We generalize the canonical model (Maskin, 1977) by allowing agents to send evidence or discriminatory signals. A leading case is where evidence is hard information that proves something about the state of the world. In this environment, an implementable social choice rule need not be Maskin-monotonic. We formulate a weaker property, evidence-monotonicity, and show that this is a necessary condition for implementation. Evidence-monotonicity is also sufficient for implementation if there are three or more agents and the social choice rule satisfies two other properties—no veto power and non-satiation—that are reasonable in various settings, including “economic environments”. We discuss how natural conditions on the cost of discriminatory signals yield possibility results, in contrast with traditional negative results. Additional results are provided for the case of one and two agents.

Implementation with evidence

We generalize the canonical problem of Nash implementation by allowing agents to voluntarily provide discriminatory signals, i.e. evidence. Evidence can either take the form of hard information or, more generally, have differential but non-prohibitive costs in different states. In such environments, social choice functions that are not Maskin-monotonic can be implemented. We formulate a more general property, evidence-monotonicity, and show that this is a necessary condition for implementation. Evidence-monotonicity is also sufficient for implementation in economic environments. In some settings, such as when agents have small preferences for honesty, any social choice function is evidence-monotonic. Additional characterizations are obtained for hard evidence. We discuss the relationship between the implementation problem where evidence provision is voluntary and a hypothetical problem where evidence can be chosen by the planner as part of an extended outcome space.Mechanism design, costly signaling, verifiable information, Nash implementation

Of Candidates and Character

We study the characteristics of self-selected candidates in corrupt political systems. Potential candidates differ along two dimensions of unobservable character: public spirit (altruism toward others) and honesty (the disutility suffered when selling out to special interests after securing office). Both aspects combine to determine an individual's quality as governor. We characterize properties of equilibrium candidate pools for arbitrary costs of running for office. As the cost of running vanishes, there is an essentially unique candidate pool, which is typically highly asymmetric: it consists of only the most dishonest individuals but a mixture of the most selfish and the most public-spirited ones. We explore how two policy instruments -- the governor's compensation and anti-corruption enforcement -- affect the expected quality of governance through candidate self-selection. We also examine the effects of incumbency and term limits on self-selection in a dynamic version of the model.

Opinion as Incentives

We study a model where a decision maker (DM) must select an adviser to advise her about an unknown state of the world. There is a pool of available advisers who all have the same underlying preferences as the DM; they differ, however, in their prior beliefs about the state, which we interpret as differences of opinion. We derive atradeoff faced by the DM: an adviser with a greater difference of opinion has greater incentives to acquire information, but reveals less of any information she acquires, via strategic disclosure. Nevertheless, it is optimal to choose an adviser with at least some difference of opinion. The analysis reveals two novel incentives for an agent to acquire information: a ``persuasion'' motive and a motive to ``avoid prejudice.'' Delegation is costly for the DM because it eliminates both of these incentives. We also study the relationship between difference of opinion and difference of preference.

Improving Information from Manipulable Data

Data-based decisionmaking must account for the manipulation of data by agents who are aware of how decisions are being made and want to affect their allocations. We study a framework in which, due to such manipulation, data becomes less informative when decisions depend more strongly on data. We formalize why and how a decisionmaker should commit to underutilizing data. Doing so attenuates information loss and thereby improves allocation accuracy

Contests for experimentation

We study contests for innovation with learning about the innovation’s feasibility and opponents’ outcomes. We characterize contests that maximize innovation when the designer chooses a prize-sharing scheme and a disclosure policy. A “public winnertakes-all contest” dominates public contests—where any success is immediately disclosed—with any other prize-sharing scheme as well as winner-takes-all contests with any other disclosure policy. Yet, jointly modifying prize sharing and disclosure can increase innovation. In a broad class of mechanisms, it is optimal to share the prize with disclosure following a certain number of successes; under simple conditions, a “hidden equal-sharing” contest is optimal

Optimal contracts for experimentation

This paper studies a model of long-term contracting for experimentation. We consider a principal-agent relationship with adverse selection on the agent’s ability, dynamic moral hazard, and private learning about project quality. We find that each of these elements plays an essential role in structuring dynamic incentives, and it is only their interaction that generally precludes efficiency. Our model permits an explicit characterization of optimal contracts