Reputations often guide sequential decisions to trust and to reward trust. We consider situations where each player is randomly matched with a partner in every period. One player – the truster – decides whether to trust. If trusted, the other player – the temptee – has a temptation to...

"In a world of imperfect information, reputations often guide the sequential decisions to trust and to reward trust. We consider two-player situations, where the trusted player, called the temptee, has a temptation to betray. The strength of the temptation to betray varies from encounter to...

In a world of imperfect information, reputations often guide the sequential decisions to trust and to reward trust. We consider two-player situations where the players meet but once. One player - the truster - decides whether to trust, and the other player - the temptee - has a temptation to...

Aseller in an online marketplace with an effective reputation mechanism should expect that dishonest behavior results in higher payments now whereas honest behavior results in a better reputation--and thus higher payments--in the future. We study the Window Aggregation Mechanism, a widely used...

Individual choice among health insurance policies may result in risk-based sorting across plans. Such adverse selection induces three types of losses: efficiency losses from individuals' being allocated to the wrong plans; risk-sharing losses, because premium variability is increased; and losses...