Is reciprocity really outcome-based? A second look at gift-exchange with random shocks

Brent Davis, Rudolf Kerschbamer and Regine Oexl ()
Additional contact information
Regine Oexl: University of Innsbruck

Journal of the Economic Science Association, 2017, vol. 3, issue 2, No 5, 149-160

Abstract: Abstract By means of a laboratory experiment, Rubin and Sheremeta (Manag Sci 62(4):985–999, 2016), study a bonus-version of the gift-exchange game, including two treatment variations. First they vary whether the effort provided by the agent directly translates into output for the principal, or whether it is distorted by a shock. Second, for the condition with a shock they vary whether the shock is observed by the principal, or not. The authors’ main findings are that (1) the introduction of an unobservable shock significantly reduces welfare; and (2) informing the principal about the size of the shock does not restore gift-exchange. In a replication study we largely reproduce finding (1), but we fail to confirm finding (2). Our data suggests that small behavioral differences in the initial rounds lead to a hysteresis effect that is responsible for the differences in results across studies.

Keywords: Gift-exchange; Principal agent model; Incomplete contracts; Random shocks; Outcome-based reciprocity; Replication study; Laboratory experiment (search for similar items in EconPapers)
JEL-codes: C72 C91 D63 D81 H50 (search for similar items in EconPapers)
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (11)

Downloads: (external link)
http://link.springer.com/10.1007/s40881-017-0041-2 Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:jesaex:v:3:y:2017:i:2:d:10.1007_s40881-017-0041-2

Ordering information: This journal article can be ordered from
http://www.springer.com/journal/40881

DOI: 10.1007/s40881-017-0041-2

Access Statistics for this article

Journal of the Economic Science Association is currently edited by Nikos Nikiforakis and Robert Slonim

More articles in Journal of the Economic Science Association from Springer, Economic Science Association Contact information at EDIRC.
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().