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The Economics of Credence Goods: On the Role of Liability, Verifiability, Reputation and Competition
Dulleck, Uwe; Kerschbamer, Rudolf; Sutter, Matthias - Institute for the Study of Labor (IZA) - 2009
Credence goods markets are characterized by asymmetric information between sellers and consumers that may give rise to inefficiencies, such as under- and overtreatment or market break-down. We study in a large experiment with 936 participants the determinants for efficiency in credence goods...
Persistent link: https://www.econbiz.de/10005822832
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The Impact of Distributional Preferences on (Experimental) Markets for Expert Services
Kerschbamer, Rudolf; Sutter, Matthias; Dulleck, Uwe - Institute for the Study of Labor (IZA) - 2009
Credence goods markets suffer from inefficiencies arising from informational asymmetries between expert sellers and customers. While standard theory predicts that inefficiencies disappear if customers can verify the quality received, verifiability fails to yield efficiency in experiments with...
Persistent link: https://www.econbiz.de/10008550001
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Guilt from Promise-Breaking and Trust in Markets for Expert Services: Theory and Experiment
Beck, Adrian; Kerschbamer, Rudolf; Qiu, Jianying; … - Institute for the Study of Labor (IZA) - 2010
to a consumer first, whereupon the consumer can express her trust by paying an interaction price before the expert …
Persistent link: https://www.econbiz.de/10008529143
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Courtesy and Idleness: Gender Differences in Team Work and Team Competition
Ivanova-Stenzel, Radosveta; Kübler, Dorothea - Institute for the Study of Labor (IZA) - 2005
Does gender play a role in the context of team work? Our results based on a real-effort experiment suggest that performance depends on the composition of the team. We find that female and male performance differ most in mixed teams with revenue sharing between the team members, as men put in...
Persistent link: https://www.econbiz.de/10005566353
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Strategic Ignorance in Bargaining
Conrads, Julian; Irlenbusch, Bernd - Institute for the Study of Labor (IZA) - 2011
In his classic article "An Essay on Bargaining" Schelling (1956) argues that ignorance might actually be strength rather than weakness. We test and confirm Schelling's conjecture in a simple take-it-or-leave bargaining experiment where the proposer can choose between two possible offers. Option...
Persistent link: https://www.econbiz.de/10009371183
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Competing with Asking Prices
Lester, Benjamin R.; Visschers, Ludo; Wolthoff, Ronald P. - Institute for the Study of Labor (IZA) - 2013
In many markets, sellers advertise their good with an asking price. This is a price at which the seller is willing to … asking price and that this offer may be accepted if the seller receives no better offers. Despite their prevalence in a … environment with a few simple, realistic ingredients and demonstrate that using an asking price is optimal: it is the pricing …
Persistent link: https://www.econbiz.de/10010812035
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Self-Serving Use of Equity Rules in Bargaining with Asymmetric Outside Options
Hennig-Schmidt, Heike; Irlenbusch, Bernd; Rilke, Rainer … - Institute for the Study of Labor (IZA) - 2013
We experimentally investigate multiple notions of equity in ultimatum bargaining with asymmetric outside options. Building on the generalized equity principle formulated by Selten (1978), we derive three different equity rules that can explain 43% of all offers. Our within-subject design further...
Persistent link: https://www.econbiz.de/10010884149
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Testing a Forgotten Aspect of Akerlof's Gift Exchange Hypothesis: Relational Contracts with Individual and Uniform Wages
Kocher, Martin G.; Luhan, Wolfgang J.; Sutter, Matthias - Institute for the Study of Labor (IZA) - 2012
Empirical work on Akerlof's theory of gift exchange in labor markets has concentrated on the fair wage-effort hypothesis. In fact, however, the theory also contains a social component that stipulates that homogenous agents that are employed for the same wage level will exert more effort,...
Persistent link: https://www.econbiz.de/10011279270
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Transparency and Reciprocal Behavior in Employment Relations
Irlenbusch, Bernd; Sliwka, Dirk - Institute for the Study of Labor (IZA) - 2003
The impact of transparency on the extent of reciprocal behavior is investigated in a simple repeated gift exchange experiment, where principals set wages and agents respond by choosing effort levels. In addition to the efforts the principals’ payoffs are determined by a random component. It is...
Persistent link: https://www.econbiz.de/10005233886
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Relative Rewards within Team-Based Compensation
Irlenbusch, Bernd; Ruchala, Gabriele K. - Institute for the Study of Labor (IZA) - 2006
How to design compensation schemes to motivate team members appears to be one of the most challenging problems in the economic analysis of labour provision. We shed light on this issue by experimentally investigating team-based compensations with and without bonuses awarded to the highest...
Persistent link: https://www.econbiz.de/10005233887