Implications of Trust, Fear, and Reciprocity for Modeling Economic Behavior

This paper reports three experiments with triadic or dyadic designs. The experiments include the moonlighting game in which first-mover actions can elicit positively or negatively reciprocal reactions from second movers. First movers can be motivated by trust in positive reciprocity or fear of negative reciprocity, in addition to unconditional other-regarding preferences. Second movers can be motivated by unconditional other-regarding preferences as well as positive or negative reciprocity. The experimental designs include control treatments that discriminate among actions with alternative motivations. Data from our three experiments and a fourth one are used to explore methodological questions, including the effects on behavioral hypothesis tests of within-subjects vs. across-subjects designs, single-blind vs. double-blind payoffs, random vs. dictator first-mover control treatments, and strategy responses vs. sequential play

Implications of Trust, Fear, and Reciprocity for Modeling Economic Behavior

This paper reports three experiments with triadic or dyadic designs. The experiments include the moonlighting game in which first-mover actions can elicit positively or negatively reciprocal reactions from second movers. First movers can be motivated by trust in positive reciprocity or fear of negative reciprocity, in addition to unconditional other-regarding preferences. Second movers can be motivated by unconditional other-regarding preferences as well as positive or negative reciprocity. The experimental designs include control treatments that discriminate among actions with alternative motivations. Data from our three experiments and a fourth one are used to explore methodological questions, including the effects on behavioral hypothesis tests of within-subjects vs. across-subjects designs, single-blind vs. double-blind payoffs, random vs. dictator first-mover control treatments, and strategy responses vs. sequential play.

Implications of trust, fear, and reciprocity for modeling economic behavior

This paper reports three experiments with triadic or dyadic designs. The experiments include the moonlighting game in which first-mover actions can elicit positively or negatively reciprocal reactions from second movers. First movers can be motivated by trust in positive reciprocity or fear of negative reciprocity, in addition to unconditional other-regarding preferences. Second movers can be motivated by unconditional other-regarding preferences as well as positive or negative reciprocity. The experimental designs include control treatments that discriminate among actions with alternative motivations. Data from our three experiments and a fourth one are used to explore methodological questions, including the effects on behavioral hypothesis tests of within-subjects vs. across-subjects designs, single-blind vs. double-blind payoffs, random vs. dictator first-mover control treatments, and strategy responses vs. sequential play. Copyright Economic Science Association 2008Experiments, Theory, Parsimony, Trust, Fear, Reciprocity, Methodology,

Trust, fear, reciprocity, and altruism

This paper uses a triadic experimental design to discriminate between actions motivated by (intentions-unconditional) preferences over the distribution of material outcomes and actions motivated by attributions of the intentions of others. Such discrimination is essential to empirical guidance for theory development because modeling intentions is quite different than modeling (intentions-unconditional) preferences. The triadic design includes the moonlighting game in which first-mover actions can motivate positively- or negatively-reciprocal actions by second movers. First movers can be motivated by trust or fear, in addition to selfish or altruistic preferences. Second movers can be motivated by altruistic, inequality-averse, or selfish preferences as well as positive or negative reciprocity. The triadic design includes specially-designed dictator control treatments to discriminate among actions with alternative motivations. Data from the experiment support the conclusion that first movers ’ behavior in the moonlighting game is characterized by trust and an absence of fear. Furthermore, the first movers ’ behavior is based on realistic expectations because the second movers ’ behavior is characterized by positive reciprocity but not by significant negative reciprocity

Inside information in Ponzi schemes

First online: 18 May 2018Ponzi-like investment schemes were popular in many transition economies. Often, some government officials had inside information about the viability of such schemes and used this information to their own advantage. We introduce a novel experimental design that allows us to study the extent to which this kind of abuse of information is possible and what consequences it has for those without such information. In particular, we investigate how the proportion of informed versus uninformed investors and the promised dividends affect the way in which informed investors can exploit the investments of uninformed investors. Our results show that uninformed investors follow the observed choices of the informed even more than predicted by theory. This adds to the devastating effects that this kind of underground activity can have on the uninformed