, verifiability fails to yield efficiency in experiments with endogenous prices. We identify heterogeneous distributional preferences … selfish, efficiency loving, inequality averse, inequality loving or competitive. Results show that most subjects exhibit non …-standard distributional preferences, among which efficiency-loving and inequality aversion are most frequent. We discuss implications for …

determinants for efficiency in credence goods markets. While theory predicts that either liability or verifiability yields … efficiency, we find that liability has a crucial, but verifiability only a minor effect. Allowing sellers to build up reputation … higher efficiency as long as liability is violated …

. As a consequence, consumers are often exploited and market efficiency is threatened. However, in the digital age, it has …