Arbeitspapier

Noisy commitments: the impact of information accuracy on efficiency

We report an experiment designed to test the influence of noisy commitments on efficiency in a simple bargaining game. We investigate two different levels of commitment reliability in a variant of the peasant-dictator game. Theoretical analysis suggests that the reliability of commitments in this game does not affect efficiency. We find that accurate commitments promote efficiency, as expected by game theory. However, noisy commitments are found to impair efficiency. We explain this effect by the differences between incentives off the equilibrium path under conditions of accurate commitments and noisy commitments. This difference changes the game structure and in the current game facilitates more random responses.

Language
Englisch

Bibliographic citation
Series: Preprints of the Max Planck Institute for Research on Collective Goods ; No. 2006,4

Classification
Wirtschaft
Design of Experiments: Laboratory, Individual
Information and Product Quality; Standardization and Compatibility
Subject
Commitments
efficiency
experimental economics
information
trust

Event
Geistige Schöpfung
(who)
Ert, Eyal
Nicklisch, Andreas
Event
Veröffentlichung
(who)
Max Planck Institute for Research on Collective Goods
(where)
Bonn
(when)
2006

Handle
Last update
10.03.2025, 11:45 AM CET

Data provider

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Object type

  • Arbeitspapier

Associated

  • Ert, Eyal
  • Nicklisch, Andreas
  • Max Planck Institute for Research on Collective Goods

Time of origin

  • 2006

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