Browsing by Author Eberhard, Feess
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We extend the theoretical and experimental analysis of endogenous sorting in social dilemma games to decisions of trustees in trust games. Trustees first decide about the amount they send back if the trustor sends the money and then learn that they can exit the game for a payoff that is identical to the trustor’s endowment. We develop a behavioral model where trustors and trustees have reciprocal preferences, and hence put positive weight on the other player’s payoff if they perceive their behavior as kind. Our model yields two possible constellations: Only trustees with high reciprocity participate, or all types except those with intermediate reciprocity participate. Our data lend st...