Marc Vorsatz

An Experimental Study of Truth-Telling in a Sender-Receiver Game ⁄

A recent experimental study of Cai and Wang on strategic information transmission games reveals that subjects tend to transmit more information than predicted by the standard equilibrium analysis. To evidence that this overcommunication phenomenon can be explained in some situations in terms of a tension between normative social behavior and incentives for lying, we show that in a simple sender-receiver game subjects incurring in costs to punish liars tell the truth more often than predicted by the equilibrium analysis whereas subjects that do not punish liars after receiving a deceptive message play equilibrium strategies. Thus, we can partition the subject pool into two groups, one group of subjects with preferences for truth-telling and another group taking into account only economic incentives.

Measuring the cohesiveness of preferences: an axiomatic analysis

In this paper, we axiomatically study how to measure the similarity of preferences in a group of individuals. For simplicity, we refer to this as the cohesiveness. First, we provide axioms that characterize a family of linear and additive measures whose intersection is a partial ordinal criterion similar to first order stochastic dominance. The introduction of some additional properties isolates a one-parameter subfamily. This parameter evaluates the effect on the cohesiveness if one individual changes his ranking on a single pair of objects, as a function of how many of the remaining individuals in the group rank the first object over the second and vice versa. Finally, we characterize the focal measures of this subfamily separately showing that they coincide with measures constructed using two, at first sight, totally different approaches suggested in the literature.

Approval Voting on Dichotomous Preferences

The aim of this paper is to find normative foundations of Approval Voting when individuals have dichotomous preferences. We show that a social choice function is anonymous, neutral, strategy-proof and strictly monotone if and only if it is Approval Voting and interpret this result as an extension of May’s theorem (Econometrica 20:680–684, 1952). Then, we show that Approval Voting is the only strictly symmetric, neutral and efficient social choice function. This result is related to a characterization of Baigent and Xu (Math Soc Sci 21:21–29, 1991).

Random–Walk–Based Segregation Measures

We propose an intuitive way of how to measure segregation in social and spatial networks. Using random walks, we define the segregation index as the probability that an individual meets an individual from the same social group. The segregation index is a generalization of the isolation index and a homophily index introduced in Currarini, Jackson, and Pin (2009), and it has a closed-form relation to PageRank that facilitates its computation. We also show that the Spectral Segregation Index proposed by Echenique and Fryer (2007) is not continuous with respect to the network structure. Finally, we apply the measure to Spanish census data and to citations data from economics, and rationalize the index as the equilibrium outcome of a game.

Measuring Consensus: Concepts, Comparisons, and Properties

Motivation. Human beings do not live in isolation and they have to take many decisions collectively. Examples include the election of firm representatives, the decision of where to build a new school, and the task of how to share natural resources. Equally, the satisfaction of a single individual usually depends on the performance of the group; just think of the problem of shirking in team production. To obtain a good collective performance and, as a consequence, a high individual satisfaction, it is important that collective decisions are taken with consensus. This is because in many instances, it is not beneficial for the society as a whole if the decision is imposed by a subset of the individuals—even if this subset includes more than half of the collective— as there may be other alternatives that are more accepted by the rest of the members and that increase the overall satisfaction.

Immaterial Rewards and Sanctions in a Voluntary Contribution Experiment

In this article, we compare the causes and effects of immaterial rewards and sanctions on cooperation in a voluntary contribution experiment. It appears that both rewards and sanctions increase contributions (and that rewards are more effective than sanctions) only when subjects interact repeatedly within the same group. The effect is, however, insignificant, which could be due to the higher variance in presence of rewards and sanctions. Furthermore, it is evidenced that rewards have some negative effect on the future contribution for both the imposer and the imposed when the partner matching is applied, but both rewards and sanctions have mainly positive effects under the stranger matching. Thus it seems that the recipient of the feedback takes the message as a reliable external evaluation of her contribution only under the stranger matching protocol when the strategic use of feedback can largely be excluded. (JEL C92, H41)

Scoring rules on dichotomous preferences

In this paper, we study individual incentives to report preferences truthfully for the special case when individuals have dichotomous preferences on the set of alternatives and preferences are aggregated in form of scoring rules. In particular, we show that (a) the Borda Count coincides with Approval Voting, (b) the Borda Count is the only strategy-proof scoring rule, and (c) if the size of the electorate is greater than three, then the dichotomous preference domain is the unique maximal rich domain under which the Borda Count is strategy-proof.

Truth, Trust, and Sanctions: On Institutional Selection in Sender–Receiver Games*

We conduct a laboratory experiment to investigate the impact of institutions and institutional choice on truth-telling and trust in sender-receiver games. We find that in an institution with sanctioning opportunities, receivers sanction predominantly after having trusted lies. Individuals who sanction are responsible for truth-telling beyond standard equilibrium predictions and are more likely to choose the sanctioning institution. Sanctioning and non-sanctioning institutions coexist if their choice is endogenous and the former shows a higher level of truth-telling but lower material payoffs. It is shown that our experimental findings are consistent with the equilibrium analysis of a logit agent quantal response equilibrium with two distinct groups of individuals: one consisting of subjects who perceive non-monetary lying costs as senders and non-monetary costs when being lied to as receivers and one consisting of payoff maximizers.

Truth, Trust, and Sanctions: On Institutional Selection in Sender–Receiver Games

We conduct a laboratory experiment to investigate the impact of institutions and institutional choice on truth-telling and trust in sender-receiver games. We find that in an institution with sanctioning opportunities, receivers sanction predominantly after having trusted lies. Individuals who sanction are responsible for truth-telling beyond standard equilibrium predictions and are more likely to choose the sanctioning institution. Sanctioning and non-sanctioning institutions coexist if their choice is endogenous and the former shows a higher level of truth-telling but lower material payoffs. It is shown that our experimental findings are consistent with the equilibrium analysis of a logit agent quantal response equilibrium with two distinct groups of individuals: one consisting of subjects who perceive non-monetary lying costs as senders and non-monetary costs when being lied to as receivers and one consisting of payoff maximizers.

An experimental comparison of sequential first- and second-price auctions with synergies

Using laboratory experiments, we compare the performance of first-price and second-price auctions when two stochastically equivalent objects are auctioned sequentially and the winner of the first auction receives a positive synergy in the second auction. According to the risk-neutral subgame perfect Nash equilibrium, the second-price auction provides more efficiency and a higher revenue to the seller, but a lower ex ante expected payoff to the bidders. Our experimental data indicate precisely the opposite results for format comparisons: the first-price auction gives rise to larger levels of efficiency and revenue, but lower payoffs to the bidders. Despite the lower payoff, the likelihood of an ex post loss is also smaller under the first-price auction. Our results therefore support the common use of the first-price auction in governmental and business-to-business procurements.