Paying it forward: an experimental study on social connections and indirect reciprocity

This paper studies how in-group social connections affect outsiders’ pro-social behavior towards group members. We employ an indirect investment game, in which a recipient of a good deed has to return to a beneficiary, instead of the original donor. We introduce the naturally-occurring social connec...

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Bibliographic Details
Published inReview of economic design Vol. 27; no. 2; pp. 387 - 417
Main Authors Liang, Pinghan, Meng, Juanjuan
Format Journal Article
LanguageEnglish
Published Berlin/Heidelberg Springer Berlin Heidelberg 01.06.2023
Springer Nature B.V
Subjects
Altruism
Behavioral/Experimental Economics
Beneficiaries
Clubs
Economic Theory/Quantitative Economics/Mathematical Methods
Economics
Economics and Finance
Friendship
Game Theory
Microeconomics
Original Paper
Social and Behav. Sciences
Social networks
Student organizations
D85
Social connections
C91
D03
Indirect reciprocity
Social preferences
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Summary:This paper studies how in-group social connections affect outsiders’ pro-social behavior towards group members. We employ an indirect investment game, in which a recipient of a good deed has to return to a beneficiary, instead of the original donor. We introduce the naturally-occurring social connections between the donor and the beneficiary, and show that such connections increase the recipients’ transfer to a beneficiary by 42% when the donor’s transfer is above average. The spillover does not function through the signaling of the donor’s expectations, and altruism with an endogenous reference group explains our results well.
ISSN:1434-4742
1434-4750
DOI:10.1007/s10058-022-00298-3