Article2011

Face Value

144 citations0/0 files storedAmerican Economic Review

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Experimental Behavioral Economics Studies Decision-Making and Behavioral Economics Names, Identity, and Discrimination Research

Abstract

People pay attention to the appearance of others, and personal characteristics can affect many types of decisions. We ask, is there informational value in a face in a situation where trust and reciprocity can increase earnings? We use a laboratory trust game experiment where subjects are unable to observe a counterpart, must observe a counterpart, or can pay to reveal a counterpart's photograph. Both senders and responders are willing to pay to observe the photos, and we show that behavior, earnings, and efficiency are affected. When subjects are “face to face,” efficiency is enhanced, and senders have higher earnings. (JEL D12, D83, Z13)

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References

2009Gender Differences in Preferences 1995Trust, Reciprocity, and Social History 2006Exploiting moral wiggle room: experiments demonstrating an illusory preference for fairness 2007Why Does Ethnic Diversity Undermine Public Goods Provision?1998Are Women Less Selfish Than Men?: Evidence From Dictator Experiments 2003Public goods experiments without confidentiality: a glimpse into fund-raising 2005What you don’t know won’t hurt me: Costly (but quiet) exit in dictator games 2008Trust and gender: An examination of behavior and beliefs in the Investment Game

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