- Guilt driven reciprocity in a psychological signaling game
- Number of pages
- Amsterdam: Faculteit Economie en Bedrijfskunde
- Working Paper University of Amsterdam
- Document type
- Working paper
- Faculty of Economics and Business (FEB)
- Amsterdam School of Economics Research Institute (ASE-RI)
We propose a theory of reciprocity according to which reciprocal behavior is driven by a donor's guilt. Through an experiment we show that subjects respond to factors which induce guilt but do not reflect allocative equity or intention. When the guilt inducing factor is privately observed by the donor, a psychological signaling game results. We solve for the separating and pooling equilibria. In a separating equilibrium, the donor distorts her gift to signal a low level of the guilt inducing factor, leading to a lower average gift than under full information. Our experiment confirms this implication of the separating equilibrium.
If you believe that digital publication of certain material infringes any of your rights or (privacy) interests, please let the Library know, stating your reasons. In case of a legitimate complaint, the Library will make the material inaccessible and/or remove it from the website. Please Ask the Library, or send a letter to: Library of the University of Amsterdam, Secretariat, Singel 425, 1012 WP Amsterdam, The Netherlands. You will be contacted as soon as possible.