Fishy Gifts: Bribing with Shame and Guilt

David Ong ()

MPRA Paper from University Library of Munich, Germany

Abstract: The following is a model of psychological contracting with unmonitorable performance, implicit offers, and screening for non-performance by the announcement of the expectation of performance. It is motivated by the $250 billion prescription drug industry, which spends $19 billion per year on marketing to US doctors, mostly on `gifts', and often, as at Yale, with no monitoring for reciprocation. In one revealing incident, a drug firm representative closed her presentation to Yale medical residents by handing out $150 medical reference books and remarking, "one hand washes the other." By the next day, half the books were returned. I model this with a one shot psychological trust game with negative belief preferences and asymmetric information. I show that the `shame' of accepting a possible bribe can screen for reciprocation inducing `guilt'. An announcement can extend the effect. Current policies to deter reciprocation might aid such screening. I also discuss applications like vote buying when voting is unobservable and why taxis drivers in Naples announce inflated fares after their service is sunk.

Keywords: bribery; guilt; shame; gifts; drug firms; doctors; social norms; indirect speech; psychological trust game; contracting (search for similar items in EconPapers)
JEL-codes: C72 D82 D86 H51 H75 I11 I18 M31 M37 (search for similar items in EconPapers)
Date: 2008-05, Revised 2009-08-29
References: Add references at CitEc
Citations: View citations in EconPapers (1)

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https://mpra.ub.uni-muenchen.de/17062/1/MPRA_paper_17062.pdf revised version (application/pdf)
https://mpra.ub.uni-muenchen.de/19636/1/MPRA_paper_19636.pdf revised version (application/pdf)
https://mpra.ub.uni-muenchen.de/35197/1/MPRA_paper_35197.pdf revised version (application/pdf)

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