Vacuous Information Affects Bargaining

Korth, Christian; Reiss, Julian

doi:10.1007/s10726-013-9361-7

Cited by 1 publication

(1 citation statement)

References 36 publications

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“…Our results in the PG treatment are also consistent with evidence that individuals tend to conform to the (implicit or explicit) norms established by those whose actions they observe (Frey and Meier 2004;Bardsley and Sausgruber 2005;Alpizar et al 2008;Bicchieri and Xiao 2009;Korth and Reiss 2011). High levels of contribution to the public good, which we initially observe in both the rule-following and rule-breaking groups, are gradually crowded out, but only among rule-breakers.…”

Section: Discussionsupporting

confidence: 86%

Rules, Rule-Following and Cooperation

Kimbrough¹,

Vostroknutov²

2012

SSRN Journal

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Rules are thought to persist to the extent that the direct benefits of having them (e.g. reduced transactions costs) exceed the costs of enforcement and of occasional misapplications. We argue that a second crucial role of rules is as screening mechanisms for identifying cooperative types. Thus we underestimate the social value of rules when we consider only their instrumental value in solving a particular problem. We demonstrate experimentally that costly rule-following can be used to screen for conditional cooperators. Subjects participate in a rule-following task in which they may incur costs to follow an arbitrary written rule in an individual choice setting. Without their knowledge, we sort them into groups according to their willingness to follow the rule. These groups then play repeated public goods or trust games. Rule-following groups sustain high public goods contributions over time, but in rule-breaking groups cooperation decays. Rulefollowers also reciprocate more in trust games. However, when individuals are not sorted by type, we observe no differences in the behavior of rule-followers and rule-breakers.JEL Classifications: C91, C92, D70, D03

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