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See No Evil: Information Chains and Reciprocity in Teams

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  • Eva-Maria Steiger

    ()
    (Max Planck Institute of Economics, Jena)

  • Ro'i Zultan

    ()

Abstract

Transparency in teams can induce cooperation. We study contribution decisions by agents when previous decisions can be observed. We find that an information chain, in which each agent directly observes only the decision of her immediate predecessor, is at least as effective as a fully-transparent protocol in inducing cooperation under increasing returns to scale. In a comparable social dilemma, the information chain leads to high cooperation both when compared to a non-transparent protocol for early movers, and when compared to a fully-transparent protocol for late movers. we conclude that information chains facilitate cooperation by balancing positive and negative reciprocity.

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Paper provided by Friedrich-Schiller-University Jena, Max-Planck-Institute of Economics in its series Jena Economic Research Papers with number 2011-040.

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Date of creation: 23 Sep 2011
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Handle: RePEc:jrp:jrpwrp:2011-040

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Keywords: team production; public goods; incentives; externality; information; transparency; conditional cooperation;

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Cited by:
  1. Esteban Klor & Sebastian Kube & Eyal Winter & Ro'i Zultan, 2013. "Can Higher Rewards Lead To Less Effort? Incentive Reversal In Teams," Working Papers 1309, Ben-Gurion University of the Negev, Department of Economics.

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