Collaborative Dishonesty with Unequal Profits - an Experimental Investigation

Abstract Our experiment explores the impact of asymmetric incentives on collaboration within a context where participants can coordinate and potentially engage in deceptive practices to secure financial gains. We contrast two scenarios: one in which cooperation results in an equal distribution of gains, and another where the distribution is unequal. Our investigation focuses on the dynamics of collaborative behavior over time and digs into individual strategies employed by participants. We find that corruptive collaboration persists when its gains are unequally divided. Over time, participants acquire experience in collaborative tactics, often utilizing their reports to covert signals. Notably, participants coordinate around compromise distributions that yield smaller payments, suggesting that this context may actually reduce the perceived cost of dishonesty.