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Lying about Delegation

Author

Listed:
  • Sutan, Angela

    (Groupe ESC Dijon Bourgogne, LESSAC Laboratoire d'Expérimentation en en Sciences Sociales et Analyse des Comportements et LAMETA)

  • Vranceanu, Radu

    (ESSEC Business School)

Abstract
This paper reports results from a three-player variant of the ultimatum game in which the Proposer can delegate to a third party his decision regarding how to share his endowment with a Responder with a standard veto right. However, the Responder cannot verify whether the delegation is effective or the third party merely plays a “scapegoat” role while the decision is made by the Proposer himself. In this imperfect information setting, the Proposer can send an unverifiable message declaring his delegation strategy. The most interesting strategy is “false delegation”, in which the Proposer makes the decision but claims to have delegated it. In our sample, the recourse to false delegation is significant, and a significant number of potential Delegates accept serving in the scapegoat role. However, there are many honest Proposers, and 20% of all Delegates will refuse to be the accomplices of a dishonest Proposer. Responders tend to more readily accept poor offers in a setup that permits lying about delegation; the acceptance rate of the poor offer is the highest when Delegates can refuse the scapegoat role.

Suggested Citation

  • Sutan, Angela & Vranceanu, Radu, 2015. "Lying about Delegation," ESSEC Working Papers WP1502, ESSEC Research Center, ESSEC Business School.
    • Handle: RePEc:ebg:essewp:dr-15002
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    File URL: https://hal-essec.archives-ouvertes.fr/hal-01109345/document
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    References listed on IDEAS

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    More about this item

    Keywords

    delegation of responsibility; lies; communications strategy; ultimatum game; dishonesty;
    All these keywords.

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design

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