Presents or investments? An experimental analysis

Uri Gneezy, Werner Güth () and Frank Verboven

No 1998,56, SFB 373 Discussion Papers from Humboldt University of Berlin, Interdisciplinary Research Project 373: Quantification and Simulation of Economic Processes

Abstract: Individuals frequently transfer commodities without an explicit contract or an implicit enforcement mechanism. We design an experiment to study whether such commodity transfers can be viewed as investments based on trust and reciprocity, or whether they rather resemble presents with distributional intentions. Our experiment essentially modifies Berg et al.'s investment game by introducing an upper bound to what a contributor can be repaid afterwards. By varying this upper bound, extreme situations such as unrestricted repayment and no repayment (dictator giving) can be approximated without altering the verbal instructions otherwise. Our results show that individuals contribute more when large repayments are feasible. This is consistent with the trust and reciprocity hypothesis. Although distributional concerns in some contributions can be traced, they are not nearly close to a preference for equal payoffs.

Date: 1998
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

Downloads: (external link)
https://www.econstor.eu/bitstream/10419/61260/1/721983375.pdf (application/pdf)

Related works:
Journal Article: Presents or investments? An experimental analysis (2000)
Working Paper: Presents or investments? An experimental analysis (1998)
Working Paper: Presents or investments? An experimental analysis (1998)
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:zbw:sfb373:199856

Access Statistics for this paper

More papers in SFB 373 Discussion Papers from Humboldt University of Berlin, Interdisciplinary Research Project 373: Quantification and Simulation of Economic Processes Contact information at EDIRC.
Bibliographic data for series maintained by ZBW - Leibniz Information Centre for Economics ().