Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/75602
Authors: 
Fehr, Ernst
Gaechter, Simon
Year of Publication: 
2000
Series/Report no.: 
CESifo Working Paper 336
Abstract: 
This paper shows that reciprocity has powerful implications for many economic domains. It is an important determinant in the enforcement of contracts and social norms and enhances the possibilities of collective action greatly. Reciprocity may render the provision of explicit incentive inefficient because the incentives may crowd out voluntary co-operation. It strongly limits the effects to competition in markets with incomplete contracts and gives rise to noncompetitive wage differences. Finally, reciprocity it is also a strong force contributing to the existence of incomplete contracts.
Document Type: 
Working Paper

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