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See No Evil: Information Chains and Reciprocity in Teams

  • Roi Zultan

    ()

    (Department of Economics, Ben-Gurion University of the Negev, Beer-Sheva 84105, Israel)

  • Eva-Maria Steiger

    ()

    (Max Planck Institute of Economics, Jena)

Transparency in teams can facilitate 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 in early movers when compared to a non-transparent protocol and in late movers when compared to a fully-transparent protocol. we conclude that information chains facilitate cooperation by balancing positive and negative reciprocity.

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Paper provided by Ben-Gurion University of the Negev, Department of Economics in its series Working Papers with number 1108.

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Length: 47 pages
Date of creation: 2011
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Handle: RePEc:bgu:wpaper:1108
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