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Car mechanics in the lab: investigating the behavior of real experts on experimental markets for credence goods


  • Adrian Beck
  • Rudolf Kerschbamer
  • Jianying Qiu
  • Matthias Sutter


Credence goods, such as car repairs or medical services, are characterized by severe informational asymmetries between sellers and consumers, leading to fraud in the form of provision of insufficient service (undertreatment), provision of unnecessary service (overtreatment) and charging too much for a given service (overcharging). Recent experimental research involving a standard (student) subject pool has examined the influence of informational and market conditions on the type and level of fraud. We investigate whether professional car mechanics – as real sellers of credence goods – react in the same way to changes in informational and institutional constraints. While we find qualitatively similar effects in the fraud dimensions of undertreatment and overcharging for both subject pools, car mechanics are significantly more prone to supplying unnecessary services in all conditions, which could be a result of decision heuristics they learned in their professional training.

Suggested Citation

  • Adrian Beck & Rudolf Kerschbamer & Jianying Qiu & Matthias Sutter, 2014. "Car mechanics in the lab: investigating the behavior of real experts on experimental markets for credence goods," Economics Working Papers ECO2014/02, European University Institute.
  • Handle: RePEc:eui:euiwps:eco2014/02

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    References listed on IDEAS

    1. Dyer, Douglas & Kagel, John H & Levin, Dan, 1989. "A Comparison of Naive and Experienced Bidders in Common Value Offer Auctions: A Laboratory Analysis," Economic Journal, Royal Economic Society, vol. 99(394), pages 108-115, March.
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    Cited by:

    1. Huck, Steffen & Lünser, Gabriele & Spitzer, Florian & Tyran, Jean-Robert, 2016. "Medical insurance and free choice of physician shape patient overtreatment: A laboratory experiment," Journal of Economic Behavior & Organization, Elsevier, vol. 131(PB), pages 78-105.
    2. van Hoorn, Andre, 2017. "The Use of Identity Primes to Explain Behavioral Differences Between Groups: A Methodological Note," MPRA Paper 80011, University Library of Munich, Germany.
    3. Feser, Daniel & Runst, Petrik, 2016. "Energy efficiency consultants as change agents? Examining the reasons for EECs’ limited success," Energy Policy, Elsevier, vol. 98(C), pages 309-317.
    4. Feser, Daniel & Proeger, Till, 2015. "Asymmetric information as a barrier to knowledge spillovers in expert markets," Center for European, Governance and Economic Development Research Discussion Papers 259, University of Goettingen, Department of Economics.
    5. Daniel Feser & Till Proeger, 2017. "Asymmetric information as a barrier to knowledge spillovers in expert markets," International Entrepreneurship and Management Journal, Springer, vol. 13(1), pages 211-232, March.
    6. Dominik Erharter, 2012. "Credence goods markets, distributional preferences and the role of institutions," Working Papers 2012-11, Faculty of Economics and Statistics, University of Innsbruck.
    7. Bernd Irlenbusch & Marie Claire Villeval, 2015. "Behavioral ethics: how psychology influenced economics and how economics might inform psychology?," Post-Print halshs-01159696, HAL.

    More about this item


    Artefactual field experiment; car mechanics; credence goods;

    JEL classification:

    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games

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