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Abstract:We investigate the role of framing, inequity in initial endowments and history in shaping behavior in a corrupt transaction by extending the one-shot bribery game introduced by to a repeated game setting. We find that the use of loaded language significantly reduces the incidence of bribery and increases the level of punishment. Punishment of bribery leads to reduced bribery in future. The evidence suggests that this game captures essential features of a corrupt transaction, over and above any sentiments of inequity aversion or negative reciprocity However, showing subjects the history of past play has little effect on the level of corruption.

Weak-link games, Coordination, Recommendations, Performance Bonus, Experiments, C91, C72, L23, M52,

We use decision-making experiments with human participants to study cooperation in a laboratory public goods game. Such games pose a conflict between cooperating, which is socially optimal and free-riding, which promotes individual self-interest. Prior research emphasizes the need for de-centralized peer-to-peer punishments as an evolutionarily stable response to the problem of free-riding, especially where interactions occur over long horizons. We show that a simple exhortative message appealing to participants’ goodwill can achieve high rates of cooperation in social dilemmas played over many rounds, even in the absence of punishments for free-riding.