Behavioral Economics

Arno Apffelstaedt (University of Cologne )

  • Figleafing” and Self-Serving Behavior (with Bernd Irlenbusch, Jan-Erik Lönnqvist, and Gari Walkowitz)

  • Abstract: Decisions that appear to be self-serving are often accompanied by claims that responsibility for the outcome lies with an unbiased entity or procedure—for instance an advisor, court decision, or election outcome—to whom the decision maker has delegated her authority. In many cases, these claims are non-verifiable, arousing suspicion that they are nothing more than a “fig leaf” for selfish behaviors. We address this suspicion using a controlled lab experiment in which subjects can lie about whether they delegated the choice between a self-serving and a prosocial allocation of money to an unbiased coin. We find that “figleafing” is common and that the option to do so strongly discourages prosocial behavior: Of the 62.5% of subjects who claim to have used the coin, everyone implements the self-serving allocation. Compared to a treatment in which there exists no coin (on which to blame the self-serving allocation) or a treatment in which the decision to use the coin is observed and verifiable, the share of prosocial allocations decreases by 21.9 and 46.9 percentage points, respectively. Using a theoretical model, we argue that social image concerns are the main reason why we observe these effects and why people delegate—as well as falsely claim to delegate—the decision to the coin. We find support for this theory in three further treatments. Finally, we shed light on possible remedies to figleafing by investigating the consequences of making delegation costly, requiring subjects to submit more detailed reports, and raising public awareness of fig-leaf tactics. Our results have relevance for the design of decision-making processes that aim to regulate the ethical behavior of corporations, politicians and consumers.

  • Location:
    https://helsinki.zoom.us/j/68331022200?pwd=MWxLTDZPdTUvM3d2Ni9qK1NNcU1QQT09
  • Address:
Organizers
MH
Marja-Liisa Halko

University of Helsinki

marja-liisa.halko at helsinki.fi

Other upcoming seminars