Another experimental look at reciprocal behavior: indirect reciprocity

Bonein, Aurélie and Serra, Daniel (2007): Another experimental look at reciprocal behavior: indirect reciprocity.

Abstract

This paper highlights a new social motivation, the indirect reciprocity, through a three-player dictator-ultimatum game. Player 2 has the opportunity to reward or punish indirectly the player 1 by inciting – with her offer - player 3 to accept or to reject the division. We implement three treatments: in the first two we vary player 2’s available information whereas in treatment 3, players take part in a dictator game - as proposers - before being player 2s in the dictator-ultimatum game. Results show that 55% of subjects in treatment 2 and 28% in treatment 3 behave as indirect reciprocity predicts. Another reciprocal behavior - the generalized reciprocity - is investigated through a three-player dictator game. Our data show that 80% of players 2 act according to this reciprocal behavior. Finally, our findings confirm that the more complex the strategic interaction becomes the more self-regarding behavior is likely and the less other-regarding behaviors, such as reciprocity, dominate.

• Item Type: MPRA Paper
• Institution: LAMETA
• Language: English
• Keywords: indirect reciprocity; generalized reciprocity; dictator game; ultimatum game; individual behavior
• Subjects: D - Microeconomics > D6 - Welfare Economics > D63 - Equity, Justice, Inequality, and Other Normative Criteria and Measurement; C - Mathematical and Quantitative Methods > C7 - Game Theory and Bargaining Theory > C72 - Noncooperative Games; C - Mathematical and Quantitative Methods > C9 - Design of Experiments > C91 - Laboratory, Individual Behavior

References

Akerlof, G. 1982. Labor contracts as a partial gift exchange, Quarterly Journal of Economics, 97, 543-569

Alexander, R. 1987. “The biology of moral systems”, New York: Adline de Gruyter

Axelrod, R. 1984. The Evolution of Cooperation, Basic Books, New York.

Becker, G.S. 1962. Irrational behavior and economic theory, The Journal of Political Economy, 70(1), 1-13

Ben-Ner, A., Putterman, L., Fanming, K. and Magan, D. 2004. Reciprocity in a two-part dictator game, Journal of Economic Behavior and Organization, 53, 333-52

Blount, S. 1995. When social outcomes aren’t fair: the effect of causal attributions on preferences, Organizational Behavior and Human Decision Processes, 63(2), 131- 44

Bolton, E.G., Brandts, J. and Ockenfels, A. 1998. Measuring motivations for the reciprocal responses observed in a simple dilemma game, Experimental Economics, 1(3), 207-219

Bonein, A and Serra, D. 2004. An experimental study of indirect reciprocity in a three-player dictator-ultimatum game, Communication in "Journées de Microéconomie Appliquée" conference, Lille

Box, G.E.P., Hunter, G. W. and Hunter, J. S. 1978. "Statistics for experimenters", New York: John Wiley. Buchan, N.R., Croson, R.A. and Dawes, R.M. 2002. Swift neighbors and persistent strangers: a cross cultural investigation of trust and reciprocity in social exchange, The American Journal of Sociology, 108(1), 168-206

Cubitt, R., Starmer, C. and Sugden, R. 2001. Discovered preferences and the experimental evidence of violation of expected utility theory, Journal of Economic Methodology, 8(3), 385-414

Dohmen, T., Falk, A., Huffman, D. and Sunde.U. 2006. Homo Reciprocans: Survey Evidence on Prevalence, Behavior and Success, Discussion paper of Institute for the Study of Labor n°2205

Dufwenberg, M. and Kirchsteiger, G. 2004. A theory of sequential reciprocity, Games and Economic Behavior, 47, 268-298

Dufwenberg, M., Gneezy, U., Guth, W. et van Damme, E. 2001. Direct versus indirect reciprocity: an experiment, Homo Oeconomicus, 18, 19-30

Falk, A. 2007. Gift exchange in the field, Discussion paper of Institute for the Study of Labor n°1148

Falk, A. and Zehnder, C. 2006. Trust and discrimination- a citywide experiment, working paper of Institute for the Study of Labor

Fehr, E. and Falk, A. 1999. Wage rigidities in a competitive incomplete contract market: an experimental investigation, Journal of Political Economy, 107(1), 106-134

Fehr, E. and Gachter, S. 2000. Cooperation and punishment in public goods experiments, American Economic Review, 90 (4), 980-994

Fehr, E. and Gachter, S. 2002. Altruistic punishment in humans, Nature, 415, 137-140

Fehr, E. and Schmidt, K. 2006. The economics of fairness, reciprocity and altruism – experimental evidence and new theories, in Handbook of the Economics of Giving, Altruism and Reciprocity, Volume 1: Foundations, Chapter 8, 615-694, ed. by S.-Ch. Kolm and J. Mercier-Ythier, Elsevier/North-Holland, Amsterdam

Fehr, E., Gachter, S. and Kichsteiger, G. 1997. Reciprocity as a contract enforcement device: Experimental evidence, Econometrica, 65(4), 833-860

Fehr, E., Fischbacher, U. and Gächter, S. 2002. Strong reciprocity, human cooperation and the enforcement of social norms, Human Nature, 13, 1-25

Fudenberg, D. and Maskin, E. 1986. The Folk theorem in repeated games with discounting or with incomplete information, Econometrica, 54, 533-556

Gintis, H. 2000. Strong reciprocity and human sociality. Journal of Theoretical Biology, 206, 169-179

Gouldner, A.W. 1960. The norm of reciprocity: a preliminary statement, American Sociology Review, 25, 161-178

Hoffman, E., Mc Cabe, K., Shachat, K. and Smith, V. 1994. Preferences, property rights and anonymity in bargaining games, Games and Economic Behavior, 7(3), 346-380

Kahan, D. 2005. The Logic of Reciprocity: trust, collective action and law, in H. Gintis, S. Bowles, R. Boyds and E. Fehr (eds) Moral Sentiments and Material interests: the foundation of cooperation in economic life, The MIT Press, Cambridge, chapter 12, 339-378

Kirchsteiger, G. and Sebald, A. 2006. Investments into education: doing as the parents did, Discussion Paper of Centre for economic Policy Research, n° 5686

Kolm, S.C. 2006. The theory of reciprocity, in Handbook of the Economics of Giving, Altruism and Reciprocity, Volume 1: Foundations, Chapter 6, 371-544, ed. by S.-Ch. Kolm and J. Mercier-Ythier, Elsevier/North-Holland, Amsterdam

Leimar, O. and Hammerstein, P. 2001. Evolution of cooperation through indirect reciprocity, Proceedings Biological sciences, The Royal Society, 268, 745-53.

Mauss, M. 1954. Forms and functions of exchange in archaic societies. Routledge & K. Paul Ltd

Nowak, M.A. and Sigmund, K. 1998a. The dynamics of indirect reciprocity, Journal of Theoretical Biology, 194, 561-574

Nowak, M.A. and Sigmund, K. 1998b. Evolution of indirect reciprocity by image scoring, Nature, 393, 573-577

Rabin, M. 1993. Incorporating fairness into games theory and economics, American Economic Review, 83, 1281-1302

Seinen, I. and Schram, A. 2006. Social status and group norms: indirect reciprocity in a repeated helping experiment, European Economic Review, 50(3), 581-602

Selten, R. 1967. Die Strategiemethode zur Erforschung des Eingeschänkt Rationalen Verhaltens im Rahmen eines Oligopolexperiments. In Beiträge zur Experimentellen Wirstschafsforschung, H. Sauermann,eds., 136-168

Takahashi, N. and Mashima, R. 2006. The importance of subjectivity in perceptual errors on the emergence of indirect reciprocity, Journal of Theoretical Biology, 243, 418-436

Trivers, R.L. 1971. The evolution of reciprocal altruism. Quarterly Review of Biology, 46, 35-57

White, H. 1980. A Heteroscedasticity-Consistent Covariance Matrix Estimator and a Direct Test for Heteroscedasticity, Econometrica, 48, 817-838