Universität zu Köln

Kerschbamer, Rudolf ORCID: 0000-0002-7666-7157, Sutter, Matthias ORCID: 0000-0002-6143-8706 and Dulleck, Uwe ORCID: 0000-0002-0953-5963 (2017). How Social Preferences Shape Incentives in (Experimental) Markets for Credence Goods. Econ. J., 127 (600). S. 393 - 417. OXFORD: OXFORD UNIV PRESS. ISSN 1468-0297

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Abstract

Credence goods markets suffer from inefficiencies caused by superior information of sellers about the surplus-maximising quality. While standard theory predicts that equal mark-up prices solve the credence goods problem if customers can verify the quality received, experimental evidence indicates the opposite. We identify a lack of robustness with respect to heterogeneity in social preferences as a possible cause of this and conduct new experiments that allow for parsimonious identification of sellers' social preference types. Our results confirm the assumed heterogeneity in social preferences and provide strong support for our explanation of the failure of verifiability to increase efficiency.

Item Type:	Journal Article
Creators:	Creators Email ORCID ORCID Put Code Kerschbamer, Rudolf UNSPECIFIED orcid.org/0000-0002-7666-7157 UNSPECIFIED Sutter, Matthias UNSPECIFIED orcid.org/0000-0002-6143-8706 UNSPECIFIED Dulleck, Uwe UNSPECIFIED orcid.org/0000-0002-0953-5963 UNSPECIFIED
URN:	urn:nbn:de:hbz:38-238911
DOI:	10.1111/ecoj.12284
Journal or Publication Title:	Econ. J.
Volume:	127
Number:	600
Page Range:	S. 393 - 417
Date:	2017
Publisher:	OXFORD UNIV PRESS
Place of Publication:	OXFORD
ISSN:	1468-0297
Language:	English
Faculty:	Faculty of Management, Economy and Social Sciences
Divisions:	Center of Excellence C-SEB
Subjects:	Economics
Uncontrolled Keywords:	Keywords Language AGENCY PROBLEMS; COMPETITION; ECONOMICS; RECIPROCITY; REPUTATION; FAIRNESS; BELIEFS; FRAUD; FEES Multiple languages Economics Multiple languages
Refereed:	Yes
URI:	http://kups.ub.uni-koeln.de/id/eprint/23891