Reputation Transmission Without Benefit to the Reporter: A Behavioral Underpinning of Markets in Experimental Focus

15 Pages Posted: 5 Dec 2017

See all articles by Kenju Kamei

Kenju Kamei

Durham University - Department of Economics and Finance

Louis Putterman

Brown University - Department of Economics

Multiple version iconThere are 2 versions of this paper

Date Written: January 2018

Abstract

Reputation is a commonly cited check on opportunism, but it is often unclear what motivates an agent to report another's behavior when it is easy for the aggrieved individual to move on. In a sharply focused laboratory experiment, we find that many cooperators pay to report a defecting partner without the possibility of pecuniary benefit when this has the potential to deprive the latter of future gains and to help his next partner. We illustrate how a social preference can explain such costly reporting, and also discuss evidence for a role of emotions.

JEL Classification: C91, D03, D63

Suggested Citation

Kamei, Kenju and Putterman, Louis G., Reputation Transmission Without Benefit to the Reporter: A Behavioral Underpinning of Markets in Experimental Focus (January 2018). Economic Inquiry, Vol. 56, Issue 1, pp. 158-172, 2018, Available at SSRN: https://ssrn.com/abstract=3079061 or http://dx.doi.org/10.1111/ecin.12477

Kenju Kamei (Contact Author)

Durham University - Department of Economics and Finance ( email )

Durham, DH1 3HY
United Kingdom

Louis G. Putterman

Brown University - Department of Economics ( email )

Box B
Providence, RI 02912
United States
401-863-3837 (Phone)
401-863-1970 (Fax)

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