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Reputation in a public goods game: Taking the design of credit bureaus to the lab

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  • McIntosh, Craig
  • Sadoulet, Elisabeth
  • Buck, Steven
  • Rosada, Tomas

Abstract

We present the results of a new laboratory experiment designed to mimic the ways in which credit bureaus will alter microfinance markets. Where loans are taken in groups, bureaus can build reputations for borrowers at the group or the individual level, and the optimal contract is not obvious. In a modified public goods game with ejection and re-assignment played by Guatemalan micro-entrepreneurs, we find the use of group reputation to be effective in increasing contributions. Given the costs of transitioning microfinance bureaus to the sharing of individual information, our results suggest that this change would not be cost effective.

Suggested Citation

  • McIntosh, Craig & Sadoulet, Elisabeth & Buck, Steven & Rosada, Tomas, 2013. "Reputation in a public goods game: Taking the design of credit bureaus to the lab," Journal of Economic Behavior & Organization, Elsevier, vol. 95(C), pages 270-285.
  • Handle: RePEc:eee:jeborg:v:95:y:2013:i:c:p:270-285
    DOI: 10.1016/j.jebo.2012.09.013
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    Cited by:

    1. Lu, Peng, 2015. "Learn good from bad: Effects of good and bad neighbors in spatial prisoners’ dilemma games," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 436(C), pages 351-358.
    2. Lu, Peng & Wang, Fang, 2015. "Heterogeneity of inferring reputation probability in cooperative behaviors for the spatial prisoners’ dilemma game," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 433(C), pages 367-378.
    3. repec:eee:apmaco:v:310:y:2017:i:c:p:48-56 is not listed on IDEAS
    4. Lu, Peng, 2015. "Imitating winner or sympathizing loser? Quadratic effects on cooperative behavior in prisoners’ dilemma games," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 436(C), pages 327-337.

    More about this item

    Keywords

    Information; Reputation; Public goods; Credit bureaus; Microfinance;

    JEL classification:

    • C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments
    • D71 - Microeconomics - - Analysis of Collective Decision-Making - - - Social Choice; Clubs; Committees; Associations
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design

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