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on Evolutionary Economics |
| By: | Gerald Eisenkopf; Ruslan Gurtoviy; Verena Utikal |
| Abstract: | A small lie appears trivial but it obviously violates moral commandments. We analyze whether the preference for others’ truth telling is absolute or depends on the size of a lie. In a laboratory experiment we compare punishment for different sizes of lies controlling for the resulting economic harm. We find that people are sensitive to the size of a lie and that this behavioral pattern is driven by honest people. People who lie themselves punish softly in any context. |
| Keywords: | Lying, norm violation, punishment, experiment |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:twi:respas:0066&r=evo |
| By: | Daniel Houser (Interdisciplinary Center for Economic Science and Department of Economics, George Mason University); Stefan Vetter (University of Munich); Joachim Winter (University of Munich) |
| Abstract: | We present evidence from a laboratory experiment showing that individuals who believe they were treated unfairly in an interaction with another person are more likely to cheat in a subsequent unrelated game. Specifically, subjects first participated in a dictator game. They then flipped a coin in private and reported the outcome. Subjects could increase their total payoff by cheating, i.e., lying about the outcome of the coin toss. We found that subjects were more likely to cheat in reporting the outcome of the coin flip when: 1) they received either nothing or a very small transfer from the dictator; and 2) they claimed to have been treated unfairly. |
| Keywords: | cheating, fairness, experimental design |
| JEL: | C91 D63 |
| Date: | 2011–01 |
| URL: | http://d.repec.org/n?u=RePEc:gms:wpaper:1019&r=evo |
| By: | Timo Hiller (European University Institute) |
| Abstract: | This paper presents a game-theoretic model of network formation, which allows agents to enter bilateral alliances and to extract payoffs from enemies. Each pair of agents creates a surplus of one, which allies divide in equal parts. If agents are enemies, then the agent with more allies obtains a larger share of the surplus. I show that Nash equilibria are of two types. First, a state of utopia, where all agents are allies. Second, asymmetric equilibria, such that agents can be partitioned into sets of different size, where agents within the same set are allies and agents in different sets are enemies. These results stand in contrast to coalition formation games in the economics of conflict literature, where stable group structures are generally symmetric. The model provides a game-theoretic foundation for structural balance, a long- standing notion in social psychology, which has been fruitfully applied to the study of alliance formation in international relations. |
| Keywords: | Network Formation, Economics of Conflict, Contest Success Function, Structural Balance, International Relations |
| JEL: | D86 D74 |
| Date: | 2011–06 |
| URL: | http://d.repec.org/n?u=RePEc:fem:femwpa:2011.42&r=evo |
| By: | Pelosse, Yohan |
| Abstract: | This paper introduces a notion of partitioned correlated equilibrium that extends Aumann's correlated equilibrium concept (1974, 1987). This concept captures the non-cooperative interactions arising simultaneously within and between groups. We build on this notion in order to provide a foundation for contest success functions (CSFs) in a game wherein contests arise endogenously. Our solution concept and analysis are general enough to give a foundation for any model of contest using standard equilibrium concepts like e.g., Nash, Bayesian-Nash or Perfect-Nash equilibria. In our environment, popular CSFs can be interpreted as a list of equilibrium conjectures held by players whenever they contemplate deviating from the ``peaceful outcome'' of the ``group formation game''. Our setup allows to relate the form of prominent CSFs with some textbook examples of quasi-linear utility functions, social utility functions in the spirit of Fehr and Schmidt (1999) and non-expected models of utility a la Quiggin (1981, 1982). We also show that our framework can accommodate situations in which agents cannot correlate their actions. |
| Keywords: | Contest success functions; Correlated equilibrium; Inter and intra-group conflicts; Induced contests |
| JEL: | D74 C72 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:31468&r=evo |
| By: | Thomas, Alex M; Walling, Lima |
| Abstract: | This paper questions the existing notion of competition prevalent in economic theory. It is shown that the prevalent idea of competition is incompatible with economic development. Fair competition, this paper argues, ought to be understood in context. The paper ends by providing some preliminary suggestions to economists and policy makers on how to understand competition. |
| Keywords: | Competition; Economic development; Classical economics; Indian economy |
| JEL: | D63 D41 E13 O11 L16 D43 E11 O12 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:31333&r=evo |
| By: | Andreas Nicklisch; Irenaeus Wolff |
| Abstract: | We experimentally show that current models of reciprocity are in- complete in a systematic way using a new variant of the ultimatum game that provides second-movers with a marginal-cost-free punish- ment option. For a substantial proportion of the population, the de- gree of rst-mover unkindness determines the severity of punishment actions even when marginal costs are absent. The proportion of these subjects strongly depends on a treatment variation: higher xed costs of punishment lead to harsher responses. The fractions of purely self- ish and inequity-averse participants are small and stable. Among the variety of reciprocity models, only one accommodates (rather than predicts) parts of our ndings. The treatment e ect is unaccounted for. We discuss ways of incorporating our ndings into the existing models. |
| Keywords: | Distributional fairness, experiments, intention-based fair- ness, reciprocity, ultimatum bargaining |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:twi:respas:0065&r=evo |