Showing 1 - 10 of 249
Persistent link: https://www.econbiz.de/10010433308
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...
Persistent link: https://www.econbiz.de/10003944278
post -. Trust has to replace own examination and verification. Applying Choquet-Expected Utility theory, a general model of …
Persistent link: https://www.econbiz.de/10011342061
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...
Persistent link: https://www.econbiz.de/10010529409
In credence goods markets, experts have better information about the appropriate quality of treatment than their customers. As experts provide both diagnosis and treatment, this leaves scope for fraud. We experimentally investigate how intensity of price competition and the level of customer...
Persistent link: https://www.econbiz.de/10009754802
determinants for efficiency in credence goods markets. While theory predicts that either liability or verifiability yields …
Persistent link: https://www.econbiz.de/10009733215
In markets for credence goods sellers are better informed than their customers about the quality that yields the highest surplus from trade. This paper studies second-degree price-discrimination in such markets. It shows that discrimination regards the amount of advice offered to customers and...
Persistent link: https://www.econbiz.de/10010354736
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...
Persistent link: https://www.econbiz.de/10010237657
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...
Persistent link: https://www.econbiz.de/10010199693
We study contracting between a consumer and an expert. The expert can invest in diagnosis to obtain a noisy signal about whether a low-cost service is sufficient or whether a high-cost treatment is required to solve the consumerś problem. This involves moral hazard because diagnosis effort and...
Persistent link: https://www.econbiz.de/10010429934