How Robust is Laboratory Gift Exchange?

Charness, Gary; Fréchette, Guillaume; Kagel, John H.

doi:10.1023/b:exec.0000026979.14590.3c

Cited by 174 publications

(108 citation statements)

References 12 publications

Supporting

Mentioning

100

Contrasting

Order By: Relevance

“…If factors such as culture and experience affect gift-exchange-as suggested by the results in Charness et al (2004), for instance-then reciprocity might be more outcome-based in the subject pool investigated by RS16 than in ours; this tendency could potentially explain the differences in results. We searched for evidence that points in that direction, but failed to find such evidence.…”

Section: Discussionmentioning

confidence: 64%

Is reciprocity really outcome-based? A second look at gift-exchange with random shocks

2017

View full text Add to dashboard Cite

By means of a laboratory experiment, Rubin and Sheremeta (Manag Sci 62(4):985-999, 2016), study a bonus-version of the gift-exchange game, including two treatment variations. First they vary whether the effort provided by the agent directly translates into output for the principal, or whether it is distorted by a shock. Second, for the condition with a shock they vary whether the shock is observed by the principal, or not. The authors' main findings are that (1) the introduction of an unobservable shock significantly reduces welfare; and (2) informing the principal about the size of the shock does not restore gift-exchange. In a replication study we largely reproduce finding (1), but we fail to confirm finding (2). Our data suggests that small behavioral differences in the initial rounds lead to a hysteresis effect that is responsible for the differences in results across studies.

show abstract

Section: Discussionmentioning

confidence: 64%

Is reciprocity really outcome-based? A second look at gift-exchange with random shocks

2017

View full text Add to dashboard Cite

show abstract

“…First, the game method may be more conducive to understanding the task than the strategy method. Other methods that may increase understanding, such as using easy-toread payoff tables, have been shown to decrease trustworthiness (Charness et al, 2004).…”

Section: Resultsmentioning

confidence: 99%

The strategy method lowers measured trustworthy behavior

2009

View full text Add to dashboard Cite

In a trust game experiment, we elicited choices using either the so-called game or strategy method. While the two methods yield similar rates of trust, the strategy method reveals a significantly lower rate of trustworthiness.Keywords: Trust; game method; laboratory; experiments; reciprocity JEL Classification: C90 IntroductionExperimental economists are increasingly using the strategy method for eliciting choices in laboratory and field experiments. Following this method, first subjects state contingent choices for every decision node they may face; then subjects are matched; and, finally, the appropriate choices are carried out for the nodes that are reached, and the other contingent choices are ignored. This contrasts with the more natural game method, in which subjects are first matched; then subjects learn when specific decision nodes are reached; and they make a single choice only for realized nodes.While from a game-theoretic perspective these elicitation methods should not affect behavior, in this paper we show that the two methods yield different behavior in a simplified trust game. Compared to the game method, in the strategy method the fraction of completely selfish subjects who act in an untrustworthy manner increases by 50 percent, and the fraction of egalitarian equal splits of the surplus falls by two-thirds.Researchers find the strategy method useful for several reasons. First, it allows the researcher to observe behavior at rarely-reached decision nodes. Second, it is convenient for use *

show abstract

“…The literature on gift exchange games (Fehr, Kirchsteiger, and Riedl 1993;Brandts and Charness 2004;Charness 2004;Charness, Frechette, and Kagel 2004) and the more recent papers on the counterproductive effects of sanctions and other measures that constrain agents' shirking (Bohnet, Frey, and Huck 2001;Fehr and Falk 2002;Fehr and List 2004;Falk and Kosfeld 2006) suggest that beliefs about others' trustworthiness may be self-reinforcing. Principals in gift exchange games who trust more in terms of paying higher up-front wages induce a higher effort level on average.…”

Section: Possible Mechanisms Behind a Causal Role Of Trustmentioning

confidence: 99%

On The Economics and Biology of Trust

Fehr

2009

Journal of the European Economic Association

575

355

View full text Add to dashboard Cite

In recent years, many social scientists have claimed that trust plays an important role in economic and social transactions. Despite its proposed importance, the measurement and the definition of trust seem to be not fully settled, and the identification of the exact role of trust in economic interactions has proven to be elusive. It is still not clear whether trust is just an epiphenomenon of good institutions or whether it plays an independent causal role capable of shaping important aggregate economic outcomes. In this paper, I rely on a behavioral definition of trust that enables us to relate it to economic primitives such as preferences and beliefs. I review strong biological and behavioral evidence indicating that trusting is not just a special case of risk-taking, but based on important forms of social preferences such as betrayal aversion. Behaviorally defined trust also opens the door for understanding national and ethnic trust differences in terms of differences in preferences and beliefs, and it suggests ways to examine and interpret a causal role of trust. ON THE ECONOMICS AND BIOLOGY OF TRUST Ernst Fehr University of Zurich AbstractIn recent years, many social scientists have claimed that trust plays an important role in economic and social transactions. Despite its proposed importance, the measurement and the definition of trust seem to be not fully settled, and the identification of the exact role of trust in economic interactions has proven to be elusive. It is still not clear whether trust is just an epiphenomenon of good institutions or whether it plays an independent causal role capable of shaping important aggregate economic outcomes. In this paper, I rely on a behavioral definition of trust that enables us to relate it to economic primitives such as preferences and beliefs. I review strong biological and behavioral evidence indicating that trusting is not just a special case of risk-taking, but based on important forms of social preferences such as betrayal aversion. Behaviorally defined trust also opens the door for understanding national and ethnic trust differences in terms of differences in preferences and beliefs, and it suggests ways to examine and interpret a causal role of trust. (JEL: A13, C90, D10, O10)

show abstract

How Robust is Laboratory Gift Exchange?

Cited by 174 publications

References 12 publications

Is reciprocity really outcome-based? A second look at gift-exchange with random shocks

Is reciprocity really outcome-based? A second look at gift-exchange with random shocks

The strategy method lowers measured trustworthy behavior

On The Economics and Biology of Trust

Contact Info

Product

Resources

About