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Peer pressure, social spillovers, and reciprocity: an experimental analysis

Published online by Cambridge University Press:  14 March 2025

Luigi Mittone  and
Matteo Ploner
Luigi Mittone
Affiliation:
CEEL, Department of Economics, University of Trento, Via Inama, 5, 38100 Trento, Italy
Matteo Ploner*
Affiliation:
CEEL, Department of Economics, University of Trento, Via Inama, 5, 38100 Trento, Italy
*
e-mail: [email protected]
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Abstract

This study examines whether reciprocity is affected by what others know and do. Two types of social effects are investigated within the framework of a modified investment game. On the one hand, we assess the role played by the awareness that own choices are observed by another trustee—i.e., peer pressure. On the other hand, we measure the interaction between trustees’ choices—i.e., social spillovers. We find that peer pressure fosters reciprocity and, to a lesser extent, so do social spillovers.

Keywords

Social effectsReciprocityIncomplete contracts

JEL classification

C91: Laboratory, Individual Behavior C72: Noncooperative Games
Type
Research Article
Information
Experimental Economics , Volume 14 , Issue 2 , May 2011 , pp. 203 - 222
Copyright
Copyright © Economic Science Association 2010

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