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The role of communication content and reputation in the choice of transaction partners: A study based on field and laboratory data

Brosig-Koch, J.; Heinrich, T.

The role of communication content and reputation in the choice of transaction partners: A study based on field and laboratory data Thumbnail


Authors

J. Brosig-Koch

T. Heinrich



Abstract

We study the effects of communication content and its interaction with reputation on the choice of transaction partners in markets with moral hazard. We find that buyers' choices of sellers are influenced by prices and reputation information as well as by sellers' messages: buyers prefer sellers who make specific promises. If specific promises are infeasible, buyers prefer sellers whose arguments reduce the social distance. These observations do not depend on the availability of reputation information. We also find that, if specific promises are feasible, buyers' profits do not significantly differ from hypothetical profits realized under a correct expectations rule.

Citation

Brosig-Koch, J., & Heinrich, T. (2018). The role of communication content and reputation in the choice of transaction partners: A study based on field and laboratory data. Games and Economic Behavior, 112, 49-66. https://doi.org/10.1016/j.geb.2018.07.004

Journal Article Type Article
Acceptance Date Jul 13, 2018
Online Publication Date Jul 31, 2018
Publication Date Nov 1, 2018
Deposit Date Jul 17, 2018
Publicly Available Date Jan 31, 2020
Journal Games and Economic Behavior
Print ISSN 0899-8256
Publisher Elsevier
Peer Reviewed Peer Reviewed
Volume 112
Pages 49-66
DOI https://doi.org/10.1016/j.geb.2018.07.004
Public URL https://durham-repository.worktribe.com/output/1320623

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