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Trust, reciprocity and altruism: An impossible addition

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  • Di Bartolomeo Giovanni
  • Papa Stefano

Abstract

This paper attempts to measure conditional and unconditional other-regarding preferences in two versions of an investment game: a canonical one and a cheap-talk variant where some pre-play is also allowed (i.e., non-binding unilateral messages). We find that counter-factual measures, as the well-known triadic design (Cox, 2004 [G&EB]) may systematically fail in distinguishing between conditional and unconditional other-regarding preferences due to the existence of frame effects. Specifically, by using indirect methods, we document conditional other-regarding preferences that are systematically neglected by the triadic approach. By inspecting result from the cheap-talk variant of the game, we also find that messages have no effect on average, but they affect the participants’ behavior leading to a polarization of their choices.

Suggested Citation

  • Di Bartolomeo Giovanni & Papa Stefano, 2011. "Trust, reciprocity and altruism: An impossible addition," wp.comunite 0082, Department of Communication, University of Teramo.
  • Handle: RePEc:ter:wpaper:0082
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    File URL: http://wp.comunite.it/data/wp_no_82_2011.pdf
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    References listed on IDEAS

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    5. Gary Bolton & Jordi Brandts & Axel Ockenfels, 1998. "Measuring Motivations for the Reciprocal Responses Observed in a Simple Dilemma Game," Experimental Economics, Springer;Economic Science Association, vol. 1(3), pages 207-219, December.
    6. 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.
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    11. COOPER, R. & DEJONG, D.V. & FORSYTHE, R. & Tom Ross, 1989. "Communication In The Battle Of The Sexes Game," Carleton Industrial Organization Research Unit (CIORU) 89-03, Carleton University, Department of Economics.
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    More about this item

    Keywords

    Conditional and unconditional other-regarding preferences; trust; reciprocity; investment game; frame effect; polarization effect; cheap talk;

    JEL classification:

    • D03 - Microeconomics - - General - - - Behavioral Microeconomics: Underlying Principles
    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness

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