Religion and trust: an experimental study

We investigate the relationship between religion and trust. Using a questionnaire, we measure: i) general religiosity, and; ii) the extent of religious beliefs, experience, and ritual. These are then analyzed with behaviour in a trust game (Berg et al., Games and Economic Behaviour, 1995), which we also extend by proving information of a potential trustee's religiosity in certain tasks. We find that trusting increases with the potential trustee's religiosity. The extent to which trusting increases with a trustee's religiosity, in turn, increases with a truster's religiosity. Trustworthiness also increases with religiosity, and at an increasing rate. --Religiosity,Trust,Stereotype,Questionnaire,Experiment

On the beliefs off the path: equilibrium refinement due to quantal response and level-k

This paper studies the relevance of equilibrium and nonequilibrium explanations of behavior, with respects to equilibrium refinement, as players gain experience. We investigate this experimentally using an incomplete information sequential move game with heterogeneous preferences and multiple perfect equilibria. Only the limit point of quantal response (the limiting logit equilibrium), and alternatively that of level-k reasoning (extensive form rationalizability), restricts beliefs off the equilibrium path. Both concepts converge to the same unique equilibrium, but the predictions differ prior to convergence. We show that with experience of repeated play in relatively constant environments, subjects approach equilibrium via the quantal response learning path. With experience spanning also across relatively novel environments, though, level-k reasoning tends to dominate

Vendettas

Vendettas occur in many real world settings where rivals compete for a prize, e.g., winning an election or a competitive promotion, by engaging in retaliatory aggressive behavior. We present a benchmark experiment where two players have an initial probability of winning a prize. Retaliatory vendettas occur and lead agents to the worst possible outcomes in 60% to 80% of cases, counter to self interest predictions, and regardless of whether initial winning probabilities are equal or unequal. Negative emotions are important and interact with economic settings to produce large social inefficiencies. Venting emotions predicts aggression but also reduces it

Indenture as a Self-Enforced Contract Device: An Experimental Test

We experimentally test the efficacy of indenture as a self-enforced contract device. In an indenture game, the principal signals the intention of payment-on-delivery, by tearing a banknote and giving the agent half of it as "prepayment"; the agent receives the completing half after delivering the service. By forward induction, cooperation is incentive-compatibly self-enforcing. The indenture performs very well, inducing a significantly higher level of cooperation than that in a three-stage centipede game, which we use to benchmark the natural rate of cooperation. The difference between cooperation rates in both games increases over time.Cooperation, experiment, contracts, indenture, reciprocity

The Economics of Solidarity: A Conceptual Framework

For many people "solidarity" has become a meaningless word used in slogans - too often used without leading to any economic consequences. We show in this paper conditions under which solidarity can be a powerful instrument. In a solidary action, an individual in a group contributes to a series of actions that aims for a reallocation of scarce resources. The willingness to contribute is mainly influenced by the efficiency of the objective of the solidary action, and is enhanced by feelings of mutual exchange (solidarity) within a group. --solidarity,altruism,dynamic,mutual

Which is the More Predictable Gender? Public Good Contribution and Personality

Personality questionnaires have been used and can be used to predict behavior in economic settings. Using two sets of state-of-the-art measures from personality psychology (the Big Six) and social psychology (Social Value Orientation), we find that the behavior of men is predictable in the first half of a public good contribution experiment, whereas that of women is not. This result agrees with the reinterpretation of Carol Gilligan's (1982) view that women are more sensitive to the context in which decisions are made. --gender,context,personality,public goods

Would I care if I knew? Image concerns and social confirmation in giving

This paper experimentally investigates the nature of image concerns in gift giving. For this, we test variants of dictator and impunity games where the influences of social preferences on behavior are kept constant across all games. Givers maximize material payoffs by pretending to be fair when receivers do not know the actual surplus size, implying that portraying an outward appearance of norm compliance matters more than actual compliance. In impunity games, receivers can reject gifts with no payoff consequence to givers. In the face of receivers' feedback, some givers ensure positive feedback by donating more while some avoid negative feedback by not giving at all. Removing feedback reduces the incentive to give altogether. Differing behavior in the four games implies that social confirmation plays a crucial role in the transmission of image concerns in giving

Indenture as a Commitment Device in Self-Enforced Contracts: An Experimental Test

How can a principal (an agent) ensure that an agent (a principal) will work (pay up), if payment (work) precedes work (payment)? When a banknote is torn in two, each part is by itself worthless. A principal can pre-commit to payment-on-delivery, by tearing a banknote and giving the agent the first half as "prepayment"; the agent receives the completing half upon delivery of the service. This contract design is known as "indenture". It is self-enforcing and incentive-compatible. This paper experimentally tests the efficacy of the "indenture game" and its implications for cooperation in oneshot environments. We find that cooperation rates are high and stable over time. Its efficacy is moderated by expected losses due to the existence of uncooperative types

Would I Care if I Knew? Image Concerns and Social Confirmation in Giving

This paper experimentally investigates the nature of image concerns in gift giving. For this, we test variants of dictator and impunity games where the influences of social preferences on behavior are kept constant across all games. Givers maximize material payoffs by pretending to be fair when receivers do not know the actual surplus size, implying that portraying an outward appearance of norm compliance matters more than actual compliance. In impunity games, receivers can reject gifts with no payoff consequence to givers. In the face of receivers' feedback, some givers ensure positive feedback by donating more while some avoid negative feedback by not giving at all. Removing feedback reduces the incentive to give altogether. Differing behavior in the four games implies that social confirmation plays a crucial role in the transmission of image concerns in giving

When Lone Wolf Defectors Undermine the Power of the Opt-Out Default

High levels of cooperation are a central feature of human society, and conditional cooperation has been proposed as one proximal mechanism to support this. The counterforce of free-riding can, however, undermine cooperation and as such a number of external mechanisms have been proposed to ameliorate the effects of free-riding. One such mechanism is setting cooperation as the default (i.e., an opt-out default). We posit, however, that in dynamic settings where people can observe and condition their actions on others’ behaviour, ‘lone wolf’ defectors undermine initial cooperation encouraged by an opt-out default, while ‘good shepherds’ defeat the free-riding encouraged by an opt-in default. Thus, we examine the dynamic emergence of conditional cooperation under different default settings. Specifically, we develop a game theoretical model to analyse cooperation under defaults for cooperation (opt-out) and defection (opt-in). The model predicts that the ‘lone wolf’ effect is stronger than the ‘good shepherd’ effect, which – if anticipated by players – should strategically deter free-riding under opt-out and cooperation under opt-in. Our experimental games confirm the existence of both ‘lone wolf’ defectors and ‘good shepherd’ cooperators, and that the ‘lone wolf’effect is stronger in the context of organ donation registration behaviour. We thus show a potential ‘dark side’ to conditional cooperation (‘lone wolf effect’) and draw implications for the adoption of an opt-out organ donation policy