Rotterdam Brown Bag Seminars General Economics

Bauke Visser (Erasmus University Rotterdam)
Tuesday, September 6, 2016

In a ‘reputation game,’ reputation-concerned agents use decisions and accompanying statements to influence assessments of their competence, and evaluators take such attempts into account when assessing them. We test the theoretical implications in the lab by comparing treatments with and without reputation concerns, and with and without statements. Reputation concerns make statements less informative. Evaluators assess agents quite well. Reputation concerns make assessments less responsive to decisions and statements, but evaluators overly react to infrequent statements and are too tough on agents if they only observe decisions. Contrary to theory, if statements accompany decisions, agents distort the decision less.