What Drives Taxi Drivers? A Field Experiment on Fraud in a Market for Credence Goods

Loukas Balafoutas, Adrian Beck, Rudolf Kerschbamer and Matthias Sutter

No 3461, CESifo Working Paper Series from CESifo

Abstract: Credence goods are characterized by informational asymmetries between sellers and consumers that invite fraudulent behavior by sellers. This paper presents the results of a natural field experiment on taxi rides in Athens, Greece, set up to measure different types of fraud and to examine the influence of passengers’ presumed information and income on the extent of fraud. Results reveal that taxi drivers cheat passengers in systematic ways: Passengers with inferior information about optimal routes are taken on longer detours while asymmetric information on the local tariff system leads to manipulated bills. Higher income seems to lead to more fraud.

Keywords: credence goods; expert services; natural field experiment; taxi rides; fraud; asymmetric information (search for similar items in EconPapers)
JEL-codes: C93 D82 (search for similar items in EconPapers)
Date: 2011
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (8)

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Related works:
Journal Article: What Drives Taxi Drivers? A Field Experiment on Fraud in a Market for Credence Goods (2013)
Working Paper: What drives taxi drivers? A field experiment on fraud in a market for credence goods (2011)
Working Paper: What Drives Taxi Drivers? A Field Experiment on Fraud in a Market for Credence Goods (2011)
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Persistent link: https://EconPapers.repec.org/RePEc:ces:ceswps:_3461

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