Enjoy the Silence: An Experiment on Truth-telling

Santiago Sanchez-Pages, M. Vorsatz

Research output: Working paperDiscussion paper

Abstract

We analyze experimentally two sender-receiver games with conflictive preferences. In the first game, the sender can choose to tell the truth, to lie, or to remain silent. The latter strategy is costly and similar to an outside option. If sent, the receiver can either trust or distrust the sender’s message. In the second game, the receiver must decide additionally whether or not to costly punish the sender after having observed the history of the game. We investigate the existence of two kinds of social preferences: Lie-aversion and preference for truth-telling. In the first game, senders tell the truth more often than predicted by the sequential equilibrium concept, they remain silent frequently, and there exists a positive correlation between the probability of being truthful and the probability of remaining silent. Our main experimental result for the extended game shows that those subjects who punish the sender with a high probability after being deceived are precisely those who send fewer but more truthful messages. We then explore two formal models of the baseline game that can account for our experimental results. First, we fit the data to the logit agent quantal response equilibrium; secondly, we solve for the Perfect Bayesian Nash equilibria of a stylized version of the baseline game with two types of senders. The equilibrium predictions obtained in both cases are consistent with both preferences for truth-telling and lie-aversion although the latter seems to be more pronounced.
Original languageEnglish
PublisherEdinburgh School of Economics Discussion Paper Series
Number of pages36
Publication statusPublished - 19 Jan 2007

Publication series

NameESE Discussion Papers
No.155

Keywords

  • experiment
  • lie-aversion
  • social preferences
  • strategic information transmission
  • truth-telling
  • C72
  • C73
  • D83

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