PhD Thesis Defense Presentation: Dominique Welt
Mr. John J. Han, a doctoral student at 平特五不中 in the Marketing area will be presenting his thesis defense entitled:
Strategic Interactions in a Market: Incentives and Trust
Wednesday, November 13, 2024, at 10:00 a.m.
(The defense will be conducted on Zoom)
Student Committee Chair: Professor Ernan Haruvy
Please note that the Defence will be conducted on Zoom. Only the student and their committee members will participate in the presentation.
Abstract:
We investigate strategic interactions between parties with competing interests. The dissertation is composed of two manuscripts, each focusing on a fundamental building block of an efficient market: incentives and trust.
The first chapter investigates the decision-making of a mediating agent, an arbiter, in resolving disputes between two parties that lay proportional claims on a fixed quantity of resources. To do so, the arbiter鈥檚 incentive structure was experimentally manipulated in a three-player negotiation game, and the lab data show low incidence of impasses and disagreements when the arbiters receive incentive that is equivalent to the payoff of the lowest-paid party. Contrary to existing theories on incentives, the market was most efficient when an arbiter was paid less.
The second chapter investigates how parties form a trust-based partnership. In the literature on trust games, a cheap talk promise and guilt are known to play a pivotal role in promoting efficiency in forming a partnership. However, in studies that reported their roles, a promise and guilt are typically confounded with a chance event that obscures the visibility of trustee鈥檚 decision, which correlates with the trustor鈥檚 decision. We design and study six variants of a trust game that allows us to disentangle a joint effect of promise, guilt, and the chance outcome. We find that the mere presence of the chance event reduces guilt by the Trustee, and is incorporated into expectations by the trustor. Additionally, we report evidence that the trustor鈥檚 decision does not align with their rational expectation.
