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You always meet twice: An experiment on intrinsic versus instrumental reciprocity

  • Johnsen, Åshild A


  • Kvaløy, Ola



In repeated games, it is hard to distinguish true prosocial behavior from strategic instrumental behavior. In particular, a player does not know whether a reciprocal action is intrinsically or instrumentally motivated. In this paper, we experimentally investigate the relationship between intrinsic and instrumental reciprocity by running a two-period repeated trust game. In the `strategic treatment' the subjects know that they will meet twice, while in the `non-strategic treatment' they do not know and hence the second period comes as a surprise. We find that subjects anticipate instrumental reciprocity, and that intrinsic reciprocity is rewarded. In fact, the total level of cooperation, in which trust is reciprocated, is higher in the non-strategic treatment. Instrumental reciprocity thus seems to crowd out intrinsic reciprocity: If one takes the repeated game incentives out of the repeated game

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Paper provided by University of Stavanger in its series UiS Working Papers in Economics and Finance with number 2014/2.

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Length: 32 pages
Date of creation: 28 Jan 2014
Date of revision:
Handle: RePEc:hhs:stavef:2014_002
Contact details of provider: Postal: University of Stavanger, NO-4036 Stavanger, Norway
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  1. Schniter, Eric & Sheremeta, Roman M. & Sznycer, Daniel, 2013. "Building and rebuilding trust with promises and apologies," Journal of Economic Behavior & Organization, Elsevier, vol. 94(C), pages 242-256.
  2. Gachter, Simon & Falk, Armin, 2002. " Reputation and Reciprocity: Consequences for the Labour Relation," Scandinavian Journal of Economics, Wiley Blackwell, vol. 104(1), pages 1-26.
  3. repec:dgr:kubcen:200922 is not listed on IDEAS
  4. Armin Falk & Ernst Fehr & Urs Fischbacher, . "Testing Theories of Fairness - Intentions Matter," IEW - Working Papers 063, Institute for Empirical Research in Economics - University of Zurich.
  5. Ernst Fehr & Martin Brown & Christian Zehnder, 2008. "On reputation: A microfoundation of contract enforcement and price rigidity," IEW - Working Papers 384, Institute for Empirical Research in Economics - University of Zurich.
  6. Jim Engle-Warnick & Robert Slonim, 2006. "Inferring repeated-game strategies from actions: evidence from trust game experiments," Economic Theory, Springer, vol. 28(3), pages 603-632, 08.
  7. Engle-Warnick, Jim & Slonim, Robert L., 2004. "The evolution of strategies in a repeated trust game," Journal of Economic Behavior & Organization, Elsevier, vol. 55(4), pages 553-573, December.
  8. Camerer, Colin & Weigelt, Keith, 1988. "Experimental Tests of a Sequential Equilibrium Reputation Model," Econometrica, Econometric Society, vol. 56(1), pages 1-36, January.
  9. Anderhub, Vital & Engelmann, Dirk & Guth, Werner, 2002. "An experimental study of the repeated trust game with incomplete information," Journal of Economic Behavior & Organization, Elsevier, vol. 48(2), pages 197-216, June.
  10. Stanca, Luca & Bruni, Luigino & Corazzini, Luca, 2009. "Testing theories of reciprocity: Do motivations matter?," Journal of Economic Behavior & Organization, Elsevier, vol. 71(2), pages 233-245, August.
  11. Reuben, E. & Suetens, S., 2009. "Revisiting Strategic versus Non-strategic Cooperation," Discussion Paper 2009-22, Tilburg University, Center for Economic Research.
  12. Urs Fischbacher, 2007. "z-Tree: Zurich toolbox for ready-made economic experiments," Experimental Economics, Springer, vol. 10(2), pages 171-178, June.
  13. Avner Ben-Ner & Famin Kong & Louis Putterman & Dan Magan, . "Reciprocity in a Two-Part Dictator Game," Working Papers 0902, Human Resources and Labor Studies, University of Minnesota (Twin Cities Campus).
  14. McCabe, Kevin A. & Rigdon, Mary L. & Smith, Vernon L., 2003. "Positive reciprocity and intentions in trust games," Journal of Economic Behavior & Organization, Elsevier, vol. 52(2), pages 267-275, October.
  15. repec:dgr:kubcen:200833 is not listed on IDEAS
  16. Berg Joyce & Dickhaut John & McCabe Kevin, 1995. "Trust, Reciprocity, and Social History," Games and Economic Behavior, Elsevier, vol. 10(1), pages 122-142, July.
  17. Ambrus, Attila & Pathak, Parag A., 2011. "Cooperation over finite horizons: A theory and experiments," Journal of Public Economics, Elsevier, vol. 95(7-8), pages 500-512, August.
  18. Gary Charness & David I. Levine, 2007. "Intention and Stochastic Outcomes: An Experimental study," Economic Journal, Royal Economic Society, vol. 117(522), pages 1051-1072, 07.
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