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Cited by 51Experimental Behavioral Economics StudiesGame Theory and ApplicationsDecision-Making and Behavioral Economics

Trust and Reciprocity in the Investment Gamewith Indirect Reward

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Güth, Werner, Königstein, Manfred, Marchand, Nadège, Nehring, Klaus·2000·Humboldt-Universität zu Berlin, Wirtschaftswissenschaftliche Fakultät
DOI 10.18452/3431
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Abstract

Experimental studies have shown that trust and reciprocity are effective in increasing efficiency when complete contracting is infeasible. One example is the study by Berg et al. (1995) of the investment game. In this game the person who receives the investment is the one who may reward the investor. This is a direct reward game. Similar to Dufwenberg et al. (2000) it is investigated to what extent trust and reward are still observable when reward is indirect; i.e., when the investor may only be rewarded by a third person who did not receive his investment. Furthermore we investigate the influence of social comparison (information about other players’ investments). Our main finding is that mainly indirect reward reduces significantly mutual cooperation.

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Cites

7 of 7 references verified0 citation errors · 0 not checkable

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  • A good strategy for the latter (interested audiences) is Observer Tit For Tat.

    “A good strategy for the latter is Observer Tit For Tat 35,68 .”

    From Evolution of indirect reciprocity (2005) · cites this paper as [68]

    The Introduction describes a third person observing an investment and potentially rewarding the investor, while the Discussion compares indirect with direct reward. Neither passage evaluates a strategy for interested audiences. Searches for “Observer Tit For Tat” and an observing-and-reciprocating strategy found no passage addressing that claim. (LLM, conf=0.72)

    Experimental — accuracy not yet measured

  • Observer Tit For Tat relies on reputation in the first round and on personal experience in all further rounds against the same co-player.

    “Observer Tit For Tat relies on reputation in the first round and on personal experience in all further rounds against the same co-player.”

    From Evolution of indirect reciprocity (2005) · cites this paper as [68]

    The Introduction (page unavailable) discusses direct and indirect rewards in investment games, but does not describe an Observer Tit For Tat strategy. Searches for the strategy name and for first-round reputation versus later personal experience found no passage addressing that distinction. (LLM, conf=0.76)

    Experimental — accuracy not yet measured

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Cites

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Research works printed but not linked: 4

  1. Bolton, G., and Ockenfels, A., (2000): Equity, Reciprocity and Competition, American Economic Review, March, 90 (1), p. 166-193:
  2. Fehr, E., and Gächter, S., (forthcoming): Fairness and Retaliation: The Economics of Reciprocity, Journal of Economic Perspectives.
  3. Fehr, E., and Schmidt, K., (1999): Fairness, Cooperation and Competition, Quarterly Journal of Economics, 458 (3), p. 817-868.
  4. Tyler, T., (1994): Interpersonel Relations and Group Process, Journal of Psychology and Social Psychology, 67 (5), p. 850-863.

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Authors
Güth, W., Königstein, M., Marchand, N., & Nehring, K.
ORCID
Venue
Humboldt-Universität zu Berlin, Wirtschaftswissenschaftliche Fakultät
Publisher
Humboldt-Universität zu Berlin, Wirtschaftswissenschaftliche Fakultät
Published
2000-10-18
DOI
10.18452/3431
OpenAlex
W1538014481
Cited by
50
References
7
Citations by year
2024: 1 · 2023: 2 · 2022: 2 · 2021: 1 · 2019: 2 · 2018: 3 · 2017: 1 · 2016: 8 · 2015: 2 · 2014: 8 · 2013: 4 · 2012: 1
Type
posted content
Language
en
Open access
Locations
  • RePEc: Research Papers in Economics (submittedVersion)
  • Econstor (Econstor) (submittedVersion)
  • edoc Publication server (Humboldt University of Berlin) (submittedVersion)
  • edoc Publication server (Humboldt University of Berlin)
  • RePEc: Research Papers in Economics
Topics
  • Social Sciences › Safety Research › Experimental Behavioral Economics Studies
  • Social Sciences › Decision Sciences › Management Science and Operations Research › Game Theory and Applications
  • Social Sciences › Decision Sciences › General Decision Sciences › Decision-Making and Behavioral Economics
Keywords
trust, reciprocity, trust game, incomplete contracting, social comparison, cooperation

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