Recently, Batabyal et al. (2005) have used a queuing model to show that there is a tension between economic cost minimization and inspection stringency in invasive species management in the following sense: Greater (lesser) inspection stringency with a larger (smaller) number of inspectors leads...

Recently, Batabyal et al. (2005) have used a queuing model to show that there is a tension between economic cost minimization and inspection stringency in invasive species management in the following sense: Greater (lesser) inspection stringency with a larger (smaller) number of inspectors leads...

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...

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...

In markets where transactions are governed by contractual incompleteness, revealed intentions to evade taxes may affect market performance. We experimentally examine the impact of tax evasion attempts on the performance of credence goods markets, where contractual incompleteness results from...

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...