Samahita, M. (2017). Venting and gossiping in conflicts: verbal expression in ultimatum games. Journal of Behavioral and Experimental Economics, 67:111-121.
Conflicts often lead to expression of emotion to unrelated parties. We study non-instrumental verbal expression in binary ultimatum games, where receivers can comment either privately or to a third-party audience prior to accepting or rejecting the offer. The potential for gossip is sufficient to induce image concerns in senders, resulting in fairer offers in the audience treatment. Consequently, despite insignificant effect on receivers’ behaviour, the possibility of verbal expression to an audience is found to increase co-operation and hence welfare. There is demand for verbal expression even when it is unobserved or not triggered by negative stimulus.
Kahsay, G. A. and Samahita, M. (2015). Pay-what-you-want pricing schemes: a self-image perspective. Journal of Behavioral and Experimental Finance, 7:17-28.
Pay-What-You-Want (PWYW) pricing schemes are becoming increasingly popular. We develop a model incorporating self-image into the buyer’s utility function and introduce heterogeneity in consumption utility and image-sensitivity, generating different purchase decisions and optimal prices across individuals. When a good’s fixed price is lower than a threshold fair value, PWYW can lead to a lower utility. This may result in a lower purchase rate and higher average price, accounting for previously unexplained field experimental evidence. An increase in the threshold value decreases the buyer’s utility and may further lower the purchase rate, resulting in a further increase in purchase price.
Samahita, M. (2013). Effect of effort on self-image: monotonically increasing self-image functions. Economics Bulletin, 33(1):152-157.
The model of moral motivation as developed by Brekke et al. (2003) is analysed with the new assumption that self-image is an increasing function of effort. While the effects of increased efficiency and new information on optimal effort levels are similar, different results are obtained when individuals are faced with volunteering opportunities with and without non-participation fees. Most significantly, participation is sustainable as a Nash equilibrium even when it is not considered morally ideal. All results adhere to previously established theories on responsibility and crowding-out.
Curating social image: experimental evidence on the value of actions and selfies with Håkan J. Holm (Job Market Paper)
We manipulate the information subjects can share on the web concerning socially sensitive actions (public good contribution) and visibility (selfie) to determine the effect on social image, as captured by the price subjects demand for publication. The overall conclusion from the experiment is that theory about social reputation can predict subjects’ social-signaling behavior. People take costly decisions to “filter” information about themselves (in retrospect) before it is published. We also report results of a more exploratory nature and find that taking a selfie has a strong negative impact on cooperation among frequent selfie takers, but not on other subjects.
Pay-what-you-want in competition
This paper presents an analysis of Pay-What-You-Want (PWYW) in competition which explains its entry and limited spread in the market. Sellers choose their pricing schemes sequentially while consumers share their surplus. The profitability and popularity of PWYW depend not only on consumers’ preferences, but also on market structure, product characteristics and sellers’ strategies. While there is no PWYW-pooling equilibrium, given a sufficiently high level of surplus-sharing and product differentiation, PWYW is chosen by later entrants to avoid Bertrand competition. The equilibrium results and their market characteristics are consistent with empirical examples of PWYW.