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Lies in Disguise - A Theoretical Analysis of Cheating

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  • Martin Dufwenberg Jr.
  • Martin Dufwenberg

Abstract

We perform a (psychological) game-theoretic analysis of cheating in the setting proposed by Fischbacher & Föllmi-Heusi (2013). The key assumption, which we refer to as perceived cheating aversion, is that the decision maker derives disutility in proportion to the amount in which he is perceived to cheat. A particular equilibrium captures the stylized facts from many experiments (in particular the co-presence of selfish, honest, and partial-lie choices) well.

Suggested Citation

  • Martin Dufwenberg Jr. & Martin Dufwenberg, 2016. "Lies in Disguise - A Theoretical Analysis of Cheating," CESifo Working Paper Series 6208, CESifo.
  • Handle: RePEc:ces:ceswps:_6208
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    References listed on IDEAS

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    More about this item

    Keywords

    cheating; lying; costs; audience; perceived cheating aversion;
    All these keywords.

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D03 - Microeconomics - - General - - - Behavioral Microeconomics: Underlying Principles
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
    • H26 - Public Economics - - Taxation, Subsidies, and Revenue - - - Tax Evasion and Avoidance

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