Understanding Honesty: An Experiment Regarding Heterogeneous Responses to Situational Social Norms

48 Pages Posted: 2 Jun 2014

See all articles by Rajna Gibson

Rajna Gibson

University of Geneva - Geneva Finance Research Institute (GFRI)

Carmen Tanner

University of Zurich - Department of Banking and Finance

Alexander F. Wagner

University of Zurich - Department of Banking and Finance; Centre for Economic Policy Research (CEPR); European Corporate Governance Institute (ECGI); Swiss Finance Institute

Date Written: March 2014

Abstract

We conduct a laboratory experiment in which we expose participants to situational social norms of approval or disapproval of lying. Participants conform to the situational pressure, but there are important differences in individual reactions. We collect data on a number of individual characteristics, including proxies for intrinsic costs of lying (ICOL). Because different ICOL proxies tap into different motives for honesty, the extent of the interaction of these proxies with situational norms and with economic incentives sheds new light on why people act more truthfully than predicted by standard economic models. This analysis also helps to determine which characteristics explain individuals’ resistance to situational norms.

Keywords: Conformity, Honesty, Pro-social concern, Protected values, Self-signaling, Situational social norms

JEL Classification: C91, G02, G30, M14

Suggested Citation

Gibson, Rajna and Tanner, Carmen and Wagner, Alexander F., Understanding Honesty: An Experiment Regarding Heterogeneous Responses to Situational Social Norms (March 2014). CEPR Discussion Paper No. DP9880. Available at SSRN: https://ssrn.com/abstract=2444901

Rajna Gibson (Contact Author)

University of Geneva - Geneva Finance Research Institute (GFRI) ( email )

40 Boulevard du Pont d'Arve
Geneva 4, 1211
Switzerland
+41.22.379.89.83 (Phone)

Carmen Tanner

University of Zurich - Department of Banking and Finance ( email )

CH-8032 Zurich
Switzerland

Alexander F. Wagner

University of Zurich - Department of Banking and Finance ( email )

Plattenstrasse 14
Zürich, 8032
Switzerland
+41 44 634 3963 (Phone)

Centre for Economic Policy Research (CEPR) ( email )

London
United Kingdom

European Corporate Governance Institute (ECGI) ( email )

c/o ECARES ULB CP 114
B-1050 Brussels
Belgium

Swiss Finance Institute ( email )

Switzerland

HOME PAGE: http://www.alex-wagner.com

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