Plausible Deniability and Cooperation in Trust Games

Anthony S. Gillies; Mary L. Rigdon

doi:10.1561/105.00000103

Plausible Deniability and Cooperation in Trust Games

Research output: Contribution to journal › Article › peer-review

Abstract

What motivates agents to choose pro-social but dominated actions in principal-agent interactions like the trust game? We investigate this by exploring the role higher-order beliefs about payoffs play in an incentivized laboratory experiment. We consider a variety of ways of distributing higher order information about payoffs, including an asymmetrical distribution that generates "plausible deniability": one agent (B) knows the other (A) doesn't know that B knows how A's payoffs are impacted by B's actions. Agents, in turn, exploit this: otherwise trustworthy types are tempted into defecting when they have plausible deniability.

Original language	English (US)
Pages (from-to)	95-118
Number of pages	24
Journal	Review of Behavioral Economics
Volume	6
Issue number	2
DOIs	https://doi.org/10.1561/105.00000103
State	Published - 2019
Externally published	Yes

Keywords

behavioral economics
guilt aversion
higher order beliefs
reciprocity
social preferences
Trust
trust game

ASJC Scopus subject areas

Economics, Econometrics and Finance (miscellaneous)
Social Psychology
Social Sciences (miscellaneous)

Access to Document

10.1561/105.00000103

Cite this

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title = "Plausible Deniability and Cooperation in Trust Games",

abstract = "What motivates agents to choose pro-social but dominated actions in principal-agent interactions like the trust game? We investigate this by exploring the role higher-order beliefs about payoffs play in an incentivized laboratory experiment. We consider a variety of ways of distributing higher order information about payoffs, including an asymmetrical distribution that generates {"}plausible deniability{"}: one agent (B) knows the other (A) doesn't know that B knows how A's payoffs are impacted by B's actions. Agents, in turn, exploit this: otherwise trustworthy types are tempted into defecting when they have plausible deniability.",

keywords = "behavioral economics, guilt aversion, higher order beliefs, reciprocity, social preferences, Trust, trust game",

author = "Gillies, \{Anthony S.\} and Rigdon, \{Mary L.\}",

note = "Funding Information: the experimental sessions. This research was supported by a grant from the International Foundation for Research in Experimental Economics. 1Notice that we have decorated the terminal nodes with both labels and payoffs. This will facilitate drawing a distinction between uncertainty about where agents are in a game tree and what their outcomes are at those locations. This is important in Appendix A. The labels are mnemonic: ωs is the subgame perfect node, ωc the cooperative node, and ωd the defection node. Publisher Copyright: {\textcopyright} 2019 A. S. Gillies and M. L. Rigdon.",

year = "2019",

doi = "10.1561/105.00000103",

language = "English (US)",

volume = "6",

pages = "95--118",

journal = "Review of Behavioral Economics",

issn = "2326-6198",

publisher = "Now Publishers Inc",

number = "2",

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T1 - Plausible Deniability and Cooperation in Trust Games

AU - Gillies, Anthony S.

AU - Rigdon, Mary L.

N1 - Funding Information: the experimental sessions. This research was supported by a grant from the International Foundation for Research in Experimental Economics. 1Notice that we have decorated the terminal nodes with both labels and payoffs. This will facilitate drawing a distinction between uncertainty about where agents are in a game tree and what their outcomes are at those locations. This is important in Appendix A. The labels are mnemonic: ωs is the subgame perfect node, ωc the cooperative node, and ωd the defection node. Publisher Copyright: © 2019 A. S. Gillies and M. L. Rigdon.

PY - 2019

Y1 - 2019

N2 - What motivates agents to choose pro-social but dominated actions in principal-agent interactions like the trust game? We investigate this by exploring the role higher-order beliefs about payoffs play in an incentivized laboratory experiment. We consider a variety of ways of distributing higher order information about payoffs, including an asymmetrical distribution that generates "plausible deniability": one agent (B) knows the other (A) doesn't know that B knows how A's payoffs are impacted by B's actions. Agents, in turn, exploit this: otherwise trustworthy types are tempted into defecting when they have plausible deniability.

AB - What motivates agents to choose pro-social but dominated actions in principal-agent interactions like the trust game? We investigate this by exploring the role higher-order beliefs about payoffs play in an incentivized laboratory experiment. We consider a variety of ways of distributing higher order information about payoffs, including an asymmetrical distribution that generates "plausible deniability": one agent (B) knows the other (A) doesn't know that B knows how A's payoffs are impacted by B's actions. Agents, in turn, exploit this: otherwise trustworthy types are tempted into defecting when they have plausible deniability.

KW - behavioral economics

KW - guilt aversion

KW - higher order beliefs

KW - reciprocity

KW - social preferences

KW - Trust

KW - trust game

UR - https://www.scopus.com/pages/publications/85162118185

UR - https://www.scopus.com/pages/publications/85162118185#tab=citedBy

U2 - 10.1561/105.00000103

DO - 10.1561/105.00000103

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AN - SCOPUS:85162118185

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EP - 118

JO - Review of Behavioral Economics

JF - Review of Behavioral Economics

IS - 2

ER -

Plausible Deniability and Cooperation in Trust Games

Abstract

Keywords

ASJC Scopus subject areas

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