Trust, reputation and relationships in grazing rights markets: An experimental economic study
AbstractTrust is frequently a requirement for economic exchanges and the management of natural resources. Providing public information on past actions can promote trust through the formation of reputations. We developed an economic experiment to test whether a formal reputation mechanism could facilitate trusting relationships in the tradable grazing rights markets. Providing information to create formal public reputations for market participants did not increase the overall efficiency of the market. However, it did result in greater equality of income between partners, suggesting that participants showed more concern for their partners when they knew they would be rated. Even with public reputation information, bilateral relationships remained central to the market. Market failures in existing grazing rights markets may be better addressed by measures to increase communication between partners rather than simply relying on a formal reputation mechanism.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoArticle provided by Elsevier in its journal Ecological Economics.
Volume (Year): 70 (2011)
Issue (Month): 4 (February)
Contact details of provider:
Web page: http://www.elsevier.com/locate/ecolecon
Experimental economics Trust Social norms Institutions Agistment Natural resource management Equity;
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Ernst Fehr & Martin Brown & Christian Zehnder, 2008.
"On Reputation: A Microfoundation of Contract Enforcement and Price Rigidity,"
2008-17, Swiss National Bank.
- Ernst Fehr & Martin Brown & Christian Zehnder, 2009. "On Reputation: A Microfoundation of Contract Enforcement and Price Rigidity," Economic Journal, Royal Economic Society, vol. 119(536), pages 333-353, 03.
- Fehr, Ernst & Brown, Martin & Zehnder, Christian, 2008. "On Reputation: A Microfoundation of Contract Enforcement and Price Rigidity," IZA Discussion Papers 3655, Institute for the Study of Labor (IZA).
- Ernst Fehr & Martin Brown & Christian Zehnder, 2008. "On reputation: A microfoundation of contract enforcement and price rigidity," IEW - Working Papers 384, Institute for Empirical Research in Economics - University of Zurich.
- Ernst Fehr & Simon Gachter & Georg Kirchsteiger, 1997.
"Reciprocity as a Contract Enforcement Device: Experimental Evidence,"
Econometric Society, vol. 65(4), pages 833-860, July.
- Georg Kirchsteiger & Ernst Fehr & Simon Gächter, 1997. "Reciprocity as a contract enforcement device: experimental evidence," ULB Institutional Repository 2013/5911, ULB -- Universite Libre de Bruxelles.
- Seinen, Ingrid & Schram, Arthur, 2006. "Social status and group norms: Indirect reciprocity in a repeated helping experiment," European Economic Review, Elsevier, vol. 50(3), pages 581-602, April.
- T. K. Ahn & R. Mark Isaac & Timothy C. Salmon, 2008. "Endogenous Group Formation," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 10(2), pages 171-194, 04.
- Iris Bohnet & Steffen Huck, 2004.
"Repetition and Reputation: Implications for Trust and Trustworthiness When Institutions Change,"
CREMA Working Paper Series
2004-09, Center for Research in Economics, Management and the Arts (CREMA).
- Iris Bohnet & Steffen Huck, 2004. "Repetition and Reputation: Implications for Trust and Trustworthiness When Institutions Change," American Economic Review, American Economic Association, vol. 94(2), pages 362-366, May.
- Martin Brown & Christian Zehnder, 2007.
"Credit Reporting, Relationship Banking, and Loan Repayment,"
Journal of Money, Credit and Banking,
Blackwell Publishing, vol. 39(8), pages 1883-1918, December.
- Martin Brown & Christian Zehnder, 2006. "Credit Reporting, Relationship Banking, and Loan Repayment," Working Papers 2006-03, Swiss National Bank.
- Berg Joyce & Dickhaut John & McCabe Kevin, 1995. "Trust, Reciprocity, and Social History," Games and Economic Behavior, Elsevier, vol. 10(1), pages 122-142, July.
- Gary E. Bolton & Elena Katok & Axel Ockenfels, 2004.
"How Effective Are Electronic Reputation Mechanisms? An Experimental Investigation,"
INFORMS, vol. 50(11), pages 1587-1602, November.
- Gary E. Bolton & Elena Katok & Axel Ockenfels, 2003. "How Effective are Electronic Reputation Mechanisms? An Experimental Investigation," Working Paper Series in Economics 3, University of Cologne, Department of Economics.
- Ahn, T.K. & Isaac, R. Mark & Salmon, Timothy C., 2009. "Coming and going: Experiments on endogenous group sizes for excludable public goods," Journal of Public Economics, Elsevier, vol. 93(1-2), pages 336-351, February.
- Ahn, T.K. & Ostrom, Elinor & Walker, James, 2010. "A common-pool resource experiment with postgraduate subjects from 41 countries," Ecological Economics, Elsevier, vol. 69(12), pages 2624-2633, October.
- Martin Brown & Armin Falk & Ernst Fehr, 2004.
"Relational Contracts and the Nature of Market Interactions,"
Econometric Society, vol. 72(3), pages 747-780, 05.
- Brown, Martin & Falk, Armin & Fehr, Ernst, 2003. "Relational Contracts and the Nature of Market Interactions," IZA Discussion Papers 897, Institute for the Study of Labor (IZA).
- Georg Kirchsteiger & Ernst Fehr & Arno Riedl, 1993.
"Does Fairness Prevent Market Clearing? An Experimental Investigation,"
ULB Institutional Repository
2013/5927, ULB -- Universite Libre de Bruxelles.
- Fehr, Ernst & Kirchsteiger, George & Riedl, Arno, 1993. "Does Fairness Prevent Market Clearing? An Experimental Investigation," The Quarterly Journal of Economics, MIT Press, vol. 108(2), pages 437-59, May.
- Marco A. Janssen, 2006. "Evolution of Cooperation when Feedback to Reputation Scores is Voluntary," Journal of Artificial Societies and Social Simulation, Journal of Artificial Societies and Social Simulation, vol. 9(1), pages 17.
- Quaas, Martin F. & Baumgartner, Stefan & Becker, Christian & Frank, Karin & Muller, Birgit, 2007. "Uncertainty and sustainability in the management of rangelands," Ecological Economics, Elsevier, vol. 62(2), pages 251-266, April.
- Bolton, Gary E. & Katok, Elena & Ockenfels, Axel, 2005. "Cooperation among strangers with limited information about reputation," Journal of Public Economics, Elsevier, vol. 89(8), pages 1457-1468, August.
- Campbell, Bruce M. & Gordon, Iain J. & Luckert, Martin K. & Petheram, Lisa & Vetter, Susanne, 2006. "In search of optimal stocking regimes in semi-arid grazing lands: One size does not fit all," Ecological Economics, Elsevier, vol. 60(1), pages 75-85, November.
- Boero, Riccardo & Bravo, Giangiacomo & Castellani, Marco & Squazzoni, Flaminio, 2009. "Reputational cues in repeated trust games," The Journal of Socio-Economics, Elsevier, vol. 38(6), pages 871-877, December.
- Bohnet, Iris & Zeckhauser, Richard, 2003.
"Trust, Risk and Betrayal,"
Working Paper Series
rwp03-041, Harvard University, John F. Kennedy School of Government.
- Teague, W.R. & Kreuter, U.P. & Grant, W.E. & Diaz-Solis, H. & Kothmann, M.M., 2009. "Economic implications of maintaining rangeland ecosystem health in a semi-arid savanna," Ecological Economics, Elsevier, vol. 68(5), pages 1417-1429, March.
- Elinor Ostrom, 2000. "Collective Action and the Evolution of Social Norms," Journal of Economic Perspectives, American Economic Association, vol. 14(3), pages 137-158, Summer.
- Vogt, Nora & Bizer, Kilian, 2013. "Lock-in effects in competitive bidding schemes for payments for ecosystem services: Revisiting the fundamental transformation," Center for European, Governance and Economic Development Research Discussion Papers 158, University of Goettingen, Department of Economics.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Zhang, Lei).
If references are entirely missing, you can add them using this form.