Reputation or Reciprocity? An Experimental Investigation

Arbeitspapier

Recent evidence highlights the importance of social norms in many economic relations. However, many of these relationships are long-term and provide repeated game incentives for performance. We experimentally investigate interaction effects of reciprocity and repeated game incentives in two treatments (one-shot and repeated) of a gift-exchange game. In both treatments we observe reciprocity, which is strengthened in the repeated game. A detailed analysis shows that in the repeated game some subjects imitate reciprocity. Thus, reciprocity and repeated game incentives reinforce each other. Observed behaviour is robust against experience. We conclude that a long-term interaction is a reciprocity-compatible contract enforcement device.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: CESifo Working Paper ; No. 496

Classification and Topics

• Classification: Wirtschaft
• Subject: Reciprocity ; reputation ; repeated games ; incomplete contracts

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Gaechter, Simon ; Falk, Armin
• Event: Veröffentlichung
• (who): Center for Economic Studies and ifo Institute (CESifo)
• (where): Munich
• (when): 2001

Further information

• Handle: http://hdl.handle.net/10419/75722
• Last update: 10.03.2025, 11:42 AM CET