American Economic Review Vol. 101 No. 4 2011

Face Value

Catherine C. Eckel¹; Ragan Petrie²

¹ School of Economic, Political and Policy Sciences, University of Texas at Dallas, 800 W. Campbell Rd., GR31, Richardson, TX 75080. · ² Interdisciplinary Center for Economic Science, George Mason University, 4400 University Dr., MSN 1B2, Fairfax, VA 22030.

Abstract

People pay attention to the appearance of others, and personal characteristics can affect many types of decisions. We ask, is there informational value in a face in a situation where trust and reciprocity can increase earnings? We use a laboratory trust game experiment where subjects are unable to observe a counterpart, must observe a counterpart, or can pay to reveal a counterpart's photograph. Both senders and responders are willing to pay to observe the photos, and we show that behavior, earnings, and efficiency are affected. When subjects are “face to face,” efficiency is enhanced, and senders have higher earnings.

DOI

10.1257/aer.101.4.1497

Volume

101

Issue

4

Pages

1497-1513

Language

en

Sources

openalex bibtex:phds-export.bib crossref

Cite

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