We examine the influence of guilt and trust on the performance of credence goods markets. An expert can make a promise to a consumer first, whereupon the consumer can express her trust by paying an interaction price before the expert’s provision and charging decisions. We argue that the...

The ability to delay gratification has been shown to be related to higher education and income and better health status. We study in an experiment with 336 kindergarten children, aged three to six years, whether intertemporal choice behavior is malleable. In a control condition, about 50% of...

We experimentally examine the impact of tax evasion attempts on the performance of credence goods markets, where contractual incompleteness results from asymmetric information on the welfare maximizing quality of the good. Our results suggest that tax evasion attempts - independently of whether...

We study with a sample of 1,070 primary school children, aged seven to eleven years, how altruism in a donation experiment is related to children's risk attitudes and intertemporal choices. Examining such a relationship is motivated by theories of reciprocal altruism that provide a cornerstone...

Markets are ubiquitous in our daily life and, despite many imperfections, they are a great source of human welfare. Nevertheless, there is a heated recent debate on whether markets erode social responsibility and moral behavior. In fact, competitive pressure on markets may create strong...

Empirical literature on moral hazard focuses exclusively on the direct impact of asymmetric information on market outcomes, thus ignoring possible repercussions. We present a field experiment in which we consider a phenomenon that we call second-degree moral hazard - the tendency of the supply...