Promises and Expectations

37 Pages Posted: 18 Dec 2013 Last revised: 9 Jan 2018

See all articles by Florian Ederer

Florian Ederer

Boston University - Markets, Public Policy, and Law; National Bureau of Economic Research (NBER); European Corporate Governance Institute (ECGI); Yale University - Cowles Foundation

Alexander Stremitzer

ETH Zurich

Date Written: October 12, 2017


We investigate why people keep their promises in the absence of external enforcement mechanisms and reputational effects. In a controlled laboratory experiment we show that exogenous variation of second-order expectations (promisors' expectations about promisees' expectations) leads to a significant change in promisor behavior. We provide evidence that a promisor's aversion to disappointing a promisee's expectation leads her to behave more generously. We propose and estimate a simple model of conditional guilt aversion that is supported by our results and nests the findings of previous contributions as special cases.

Keywords: Promises, Expectations, Beliefs, Contracts

JEL Classification: A13, C91, D03, C72, D64, K12

Suggested Citation

Ederer, Florian and Stremitzer, Alexander, Promises and Expectations (October 12, 2017). 106 Games and Economic Behavior 161-178 (2017), Cowles Foundation Discussion Paper No. 1931, UCLA School of Law, Law-Econ Research Paper No. 17-19, Available at SSRN: or

Florian Ederer (Contact Author)

Boston University - Markets, Public Policy, and Law ( email )

Boston, MA
United States

National Bureau of Economic Research (NBER) ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
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European Corporate Governance Institute (ECGI) ( email )

c/o the Royal Academies of Belgium
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Yale University - Cowles Foundation ( email )

Box 208281
New Haven, CT 06520-8281
United States

Alexander Stremitzer

ETH Zurich ( email )

Haldeneggsteig 4
Zurich, Zurich 8092

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