skip to main content
HSS Home  /  Research  /  Social Sciences Research  /  Working Papers  /  Fairness, or just gambling on it? An experimental analysis of the gift exchange game
Fairness, or just gambling on it? An experimental analysis of the gift exchange game
Paper Number: 1183
Date: 02/01/2004
Authors:
Abstract:
Fehr, Kirchsteiger and Riedl [12] experimentally test a labor market in which worker effort levels are chosen after wages are set. They observe high wages and effort levels in the repeated game, contrary to the equilibrium prediction. In a similar experimental test of lemons markets, Lynch Miller, Plott and Porter [23] find support for the equilibrium prediction. The current paper finds more evidence of repeated game efforts than in previous studies. In a model of incomplete information regarding the reciprocal nature of other players, the FKR design is shown to be conducive to reputation effects while the LMPP design is not.
Paper Length: 33 pages
Paper: wp1183.pdf