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Evolutionary Norm Enforcement

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Author Info
Werner Gueth
Axel Ockenfels

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Abstract

Applying an indirect evolutionary approach with endogenous preference formation, we show that a legal system can induce players to reward trust even if material incentives dictate to exploit trust. By analyzing the crowding out or crowding in of trustworthiness implied by various verdict rules, we can assess how a court influences the share of kept promises of 'truly' trustworthy players who evolutionarily evolved as trustworthy and of opportunistic players woh are only trustworthy if inspired by material incentives.

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Publisher Info
Article provided by Mohr Siebeck, Tübingen in its journal Journal of Institutional and Theoretical Economics.

Volume (Year): 156 (2000)
Issue (Month): 2 (June)
Pages: 335-
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Handle: RePEc:mhr:jinste:urn:sici:0932-4569(200006)156:2_335:ene_2.0.tx_2-u

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Find related papers by JEL classification:
C73 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Stochastic and Dynamic Games; Evolutionary Games
K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law

References listed on IDEAS
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.:

  1. Ockenfels, Axel & Selten, Reinhard, 2000. "An Experiment on the Hypothesis of Involuntary Truth-Signalling in Bargaining," Games and Economic Behavior, Elsevier, vol. 33(1), pages 90-116, October. [Downloadable!] (restricted)
  2. Harsanyi, John C, 1995. "Games with Incomplete Information," American Economic Review, American Economic Association, vol. 85(3), pages 291-303, June.
    Other versions:
  3. Brennan, G. & Gueth, W. & Kliemt, H., 1997. "Trust in the shadow of the courts," Discussion Paper 89, Tilburg University, Center for Economic Research. [Downloadable!]
    Other versions:
  4. Selten, Reinhard, 1983. "Evolutionary stability in extensive two-person games," Mathematical Social Sciences, Elsevier, vol. 5(3), pages 269-363, September. [Downloadable!] (restricted)
  5. Iris Bohnet & Bruno S. Frey & Steffen Huck, . "More Order with Less Law: On Contract Enforcement, Trust, and Crowding," IEW - Working Papers iewwp052, Institute for Empirical Research in Economics - IEW. [Downloadable!]
Full references

Cited by:
(explanations, 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.)

  1. Werner Güth & Axel Ockenfels, . "The Coevolution of Morality and Legal Institutions - An indirect evolutionary approach -," Papers on Strategic Interaction 2002-06, Max Planck Institute of Economics, Strategic Interaction Group. [Downloadable!]
    Other versions:
  2. Croson, Rachel & Konow, James, 2009. "Social Preferences and Moral Biases," MPRA Paper 2729, University Library of Munich, Germany, revised Jan 2008. [Downloadable!]
  3. Friederike Mengel & Axel Ockenfels & Werner Güth, 2006. "The Dynamics of Trust and Trustworthiness on EBay. An Evolutionary Analysis of Buyer Insurance and Seller Reputation," Papers on Strategic Interaction 2006-03, Max Planck Institute of Economics, Strategic Interaction Group. [Downloadable!]
  4. Gary E. Bolton & Axel Ockenfels, 2002. "A stress test of fairness measures in models of social utility," Papers on Strategic Interaction 2002-29, Max Planck Institute of Economics, Strategic Interaction Group. [Downloadable!]
    Other versions:
  5. Edward Castronova, 2004. "Achievement Bias in the Evolution of Preferences," Journal of Bioeconomics, Springer, vol. 6(2), pages 195-226, May. [Downloadable!] (restricted)
  6. Werner Güth & Friederike Mengel & Axel Ockenfels, 2007. "An Evolutionary Analysis of Buyer Insurance and Seller Reputation in Online Markets," Theory and Decision, Springer, vol. 63(3), pages 265-282, November. [Downloadable!] (restricted)
  7. Edward Castronova, . "Achievement Bias in the Evolution of Preferences," Gruter Institute Working Papers on Law, Economics, and Evolutionary Biology 2-1-1010, Berkeley Electronic Press. [Downloadable!]
  8. Werner Güth & Axel Ockenfels, 2002. "The Coevolution of Trust and Institutions in Anonymous and Non-anonymous Communities," Papers on Strategic Interaction 2002-07, Max Planck Institute of Economics, Strategic Interaction Group. [Downloadable!]
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This page was last updated on 2009-12-3.

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