|Malmendier, Ulrike and Schmidt, Klaus M. (November 2012): You Owe Me. Discussion Papers in Economics 2012-30|
In many cultures and industries gifts are given in order to influence the recipient, often at the expense of a third party. Examples include business gifts of firms and lobbyists. In a series of experiments, we show that, even without incentive or informational effects, small gifts strongly influence the recipient’s behavior in favor of the gift giver, in particular when a third party bears the cost. Subjects are well aware that the gift is given to influence their behavior but reciprocate nevertheless. Withholding the gift triggers a strong negative response. These findings are inconsistent with the most prominent models of social preferences. We propose an extension of existing theories to capture the observed behavior by endogenizing the “reference group” to whom social preferences are applied. We also show that disclosure and size limits are not effective in reducing the effect of gifts, consistent with our model. Financial incentives ameliorate the effect of the gift but backfire when available but not provided.
|Item Type:||Paper (Discussion Paper)|
|Keywords:||Gift exchange, externalities, lobbyism, corruption, reciprocity, social preferences|
Economics > Discussion Papers in Economics
Economics > Chairs > Seminar for Economic Theory
|Subjects:||300 Social sciences > 300 Social sciences, sociology and anthropology|
300 Social sciences > 330 Economics
|JEL Classification:||C91, D73, I11|
|Deposited On:||21. Nov 2012 05:42|
|Last Modified:||15. Apr 2014 17:33|
Abbink, Klaus; Irlenbusch, Bernd and Elke Renner. 2002. “An Experimental Bribery Game.” Journal of Law, Economics, and Organization, Vol. 18, 428–454.
Abbink, Klaus. 2004. “Staff Rotation as an Anti-corruption Policy: An Experimental Study.” European Journal of Political Economy, Vol. 20, 887–906.
Akerlof, George A. 1982. “Labor Contracts as Partial Gift Exchange.” The Quarterly Journal of Economics, 97(4): 543–69.
Andreoni, James and John H Miller. 2002. “Giving According to GARP: An Experimental Test of the Consistency of Preferences for Altruism.” Econometrica, Vol. 70, 737–753.
Blau, Peter. 1964. Exchange and Power in Social Life. New York: Wiley.
Blumenthal, David. 2004. “Doctors and Drug Companies.” New England Journal of Medicine, Vol. 351, 1885–1890.
Bolton, Gary E and Axel Ockenfels. 2000. “ERC: A Theory of Equity, Reciprocity, and Competi-tion.” The American Economic Review, Vol. 90, 166–193.
Camerer, Colin. 2003. Behavioral Game Theory. Experiments in Strategic Interaction. Princeton, N.J.: Princeton University Press.
Campbell, Eric G; Gruen, Russell L; Mountford, James; Miller, Lawrence G; Cleary, Paul D and David Blumenthal. 2007. “A National Survey of Physician-Industry Relationships.” New England Journal of Medicine, Vol. 356, 1742–1750.
Charness, Gary and Martin Dufwenberg. 2006. “Promises and Partnership.” Econometrica, Vol. 74, 1579–1601.
Charness, Gary and Matthew Rabin. 2002. “Understanding Social Preferences with Simple Tests.” The Quarterly Journal of Economics, Vol. 117, 817–869.
Cialdini, Robert B. 1993. “Influence: The Psychology of Persuasion.” New York: Quill William Morrow.
Cox, James C; Friedman, Daniel and Vjollca Sadiraj. 2008. “Revealed Altruism.” Econometrica, Vol. 76, 31–69.
Dana, Jason and George Loewenstein. 2003. “A Social Science Perspective on Gifts to Physi-cians From Industry.” Journal of the American Medical Association, Vol. 290, 252–255.
Dufwenberg, Martin and Georg Kirchsteiger. 2004. “A Theory of Sequential Reciprocity.” Games and Economic Behavior, Vol. 47, 268–298.
Falk, Armin. 2007. “Gift Exchange in the Field.” Econometrica, Vol. 75, 1501–1511.
Fehr, Enst and Simon Gächter. 2000. “Fairness and Retaliation: The Economics of Reciprocity.” Journal of Economic Perspectives, 14(3): 159–81.
Fehr, Ernst; Kirchsteiger, Georg and Arno Riedl. 1993. “Does Fairness Prevent Market Clearing? An Experimental Investigation.” The Quarterly Journal of Economics, Vol. 108, 437–459.
Fehr, Ernst and Klaus M Schmidt. 1999. “A Theory of Fairness, Competition and Cooperation.” Quarterly Journal of Economics, Vol. 114, 817–868.
Fehr, Ernst and Klaus M Schmidt. 2006. “The Economics of Fairness, Reciprocity and Altruism - Experimental Evidence and New Theories.” In: Kolm, Serge-Christophe; Ythier, Jean Mercier (eds..): Handbook on the Economics of Giving, Reciprocity and Altruism, Vol. 1. Amsterdam: Elsevier, 615–691.
Fischbacher, Urs. 2007. “z-Tree: Zurich Toolbox for Ready-made Economic Experiments.” Ex-perimental Economics, Vol. 10, 171–178.
Geanakoplos, John; Pearce, David and Ennio Stacchetti. 1989. “Psychological Games and Se-quential Rationality.” Games and Economic Behavior, Vol. 1, 60–79.
Gneezy, Uri and John List. 2006. “Putting Behavioral Economics to Work: Testing for Gift Ex-change in Labor Markets Using Field Experiments.” Econometrica, 74(5): 1365–84.
Gouldner, Alvin W. 1960. “The Norm of Reciprocity: A Preliminary Statement.” American Soci-ological Review, Vol. 25, 161–178.
Grande, David. 2009. “Limiting the Influence of Pharmaceutical Industry Gifts on Physi-cians: Self Regulation of Government Intervention.” Journal of General Internal Medi-cine, Vol. 25, 79–83.
Greiner, Ben. 2004. “An Online Recruitment System for Economic Experiments.” In: Kremer, Kurt; Macho, Volker (eds.): Forschung und wissenschaftliches Rechnen. Göttingen (GWDG Bericht 63), 79–93.
Gul, Faruk and Wolfgang Pesendorfer. 2010. “The canonical type space for interdependent pref-erences.” Princeton Univerisity,
Jones, Edward E. 1964. Ingratiation: A social psychological analysis. New York, New York: Appleton-Century-Croft,
Katz, Dana; Caplan, Arthur L and Jon F Merz. 2003. “All Gifts Large and Small.” The American Journal of Bioethics, Vol. 3, 39–46.
Levine, David K. 1998. “Modeling Altruism and Spitefulness in Experiments.” Review of Eco-nomic Dynamics, Vol. 1, 593–622.
Malinowski, Bronislaw. 1922. Argonauts of the Western Pacific. London: Routledge & Kegan Paul.
Manacorda, Marco; Miguel, Edward and Andrea Vigorito. 2009. “Government Transfer and Po-litical Support,” American Economic Journal: Applied Economics, Vol. 3, 1-28.
Mauss, Marcel. 1990 . The Gift. The Form and Reason for Exchange in Archaic Societies. London: Routledge & Kegan Paul; Routledge.
Morgan, M. A; Dana, Jason and George Loewenstein. 2006. “Interactions of Doctors with the Pharmaceutical Industry.” Journal of Medical Ethics, Vol. 32, 559–563.
Murphy, Patrick E. 1995. “Corporate ethics statements: Current status and future prospects.” Journal of Business Ethics, Vol. 14, 727–740.
Rabin, Matthew. 1993. “Incorporating Fairness into Game Theory and Economics.” The Ameri-can Economic Review, Vol. 83, 1281–1302.
Rabin, Matthew. 2000. “Risk Aversion and Expected-utility Theory: A Calibration Theorem.” Econometrica, Vol. 68, 1281–1292.
Regan, Dennis T. 1971. “Effects of a Favor and Liking on Compliance.” Journal of Experimental Social Psychology, Vol. 7, 627–639.
Sobel, Joel. 2005. “Interdependent Preferences and Reciprocity.” Journal of Economic Litera-ture, Vol. 43, 392–436.
Steinman, Michael A; Shlipak, Michael G and Stephen J McPhee. 2001. “Of principles and pens: attitudes and practices of medicine housestaff toward pharmaceutical industry promo-tions.” The American Journal of Medicine, Vol. 110, 551–557.
Strassmair, Christina. 2009. “Can Intentions Spoil the Kindness of a Gift? - An Experimental Study,” mimeo, University of Munich.
Susman, Thomas M. 2008. “Private Ethics, Public Conduct. An Essay on Ethical Lobbying, Campaign Contributions, Reciprocity, and the Public Good”. Stanford Law and Policy Review, Vol. 19, 10–22.
Van Dijk, Frans and Frans van Winden. 1997. “Dynamics of Social Ties and Local Public Good Provision.” Journal of Public Economics, 64(3): 323–41.
Wazana, Ashley. 2000. “Physicians and the Pharmaceutical Industry: Is a Gift Ever Just a Gift?“ Journal of the American Medical Association, Vol. 283, 373–380.
Whatley, Mark A; Webster, J. M; Smith, Richard H and Adele Rhodes. 1999. “The Effect of a Favor on Public and Private Compliance: How Internalized is the Norm of Reciprocity.” Basic and Applied Social Psychology, Vol. 21, 251–259.
Available Versions of this Item
- You Owe Me. (deposited 21. Nov 2012 05:42) [Currently Displayed]