International Studies of Economics (Jun 2023)
Group lying with negative externality
Abstract
Abstract We use a modified die‐rolling experiment to study whether negative externality affects a group's decisions about whether to cheat. Our results show that group members are less likely to lie when faced with a passive out‐group player only if two members of the group share an unequal payment for lying. The less‐paid party in the group plays a dominant role in the honest decision by proposing the true number more frequently in arguments for group coordination.
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