Are social preferences related to market performance?
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This paper combines laboratory with field data from professional sellers to study whether social preferences are related to performance in open-air markets. The data show that sellers who are more pro-social in a laboratory experiment are also more successful in natural markets: They achieve higher prices for similar quality, have superior trade relations and better abilities to signal trustworthiness to buyers. These findings suggest that social preferences play a significant role for outcomes in natural markets.
KeywordsSocial preferences Market performance External validity Quality misrepresentation Open-air markets
JEL ClassificationC91 C93 D49
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