Ernst Fehr
Biographic Data
| ID | 169409 |
|---|---|
| NAME | Ernst Fehr |
| GIVEN NAMES | Ernst |
| FAMILY NAME | Fehr |
| SIGNATURE | FEHR E |
| AFFILIATIONS | University of Zurich |
| ORCID | 0000-0001-6325-7821 |
| VERIFIED | Yes |
| TOTAL WORKS | 75 |
| TOTAL CITATIONS | 1952 |
| AUTHOR COUNT | 74 |
| EDITOR COUNT | 1 |
| FIRST PUBLICATION YEAR | 1988 |
| LATEST PUBLICATION YEAR | 2025 |
| H-INDEX | 12 |
The Complementarity Between Trust and Contract Enforcement
Agreements are rarely fully enforceable, exposing trading parties to the risk of exploitation. In such cases, trust—defined as the belief in the trustworthiness of others—may be key to realizing gains from trade. This paper asks whether trust substitutes for or complements contract enforcement. While intuition may suggest trust matters more when enforcement is weak, our experiment, which exogenously varies both trust and enforcement, shows it can…
Social Preferences and Redistributive Politics
We study the link between social preferences and a behaviorally validated measure of support for redistribution. We uncover three fundamentally distinct social preference types: predominantly selfish, inequality averse and altruistic individuals. Inequality averse and altruistic individuals display a much stronger support for redistribution, particularly if they are more affluent. Beliefs about the role of effort and luck for success play no role…
The Impact of Working-Memory Training on Children’s Cognitive and Noncognitive Skills
Does Market Interaction Erode Moral Values
The widespread use of markets leads to unprecedented material well-being in many societies. We study whether market interaction, as a side effect, erodes moral values. In an influential paper, Falk and Szech (2013) provide experimental data that seem to suggest that “market interaction erodes moral values.” Although we replicate their main treatment effect, we show that additional treatments are necessary to corroborate their conclusion. These tr…
Can people detect the trustworthiness of strangers based on their facial appearance
Although cooperation can lead to mutually beneficial outcomes, cooperative actions only pay off for the individual if others can be trusted to cooperate as well. Identifying trustworthy interaction partners is therefore a central challenge in human social life. How do people navigate this challenge? Prior work suggests that people rely on facial appearance to judge the trustworthiness of strangers. However, the question of whether these judgments…
Teaching self-regulation
Time Will Tell: Recovering Preferences When Choices Are Noisy
The rise of affectivism
The evolution of distorted beliefs vs. mistaken choices under asymmetric error costs
Why do people sometimes hold unjustified beliefs and make harmful choices? Three hypotheses include (a) contemporary incentives in which some errors cost more than others, (b) cognitive biases evolved to manage ancestral incentives with variation in error costs and (c) social learning based on choice frequencies. With both modelling and a behavioural experiment, we examined all three mechanisms. The model and experiment support the conclusion tha…
A registered replication study on oxytocin and trust
The promise and the peril of using social influence to reverse harmful traditions
Normative foundations of human cooperation
The risk of female genital cutting in Europe: Comparing immigrant attitudes toward uncut girls with attitudes in a practicing country
Worldwide, an estimated 200 million girls and women have been subjected to female genital cutting. Female genital cutting is defined as an intentional injury to the female genitalia without medical justification. The practice occurs in at least 29 countries in Africa, the Middle East, and Asia. In addition, globalization and migration have brought immigrants from countries where cutting is commonly practiced to countries where cutting is not trad…
Redefine statistical significance
Eye spots do not increase altruism in children
Evidence for Countercyclical Risk Aversion: An Experiment with Financial Professionals
Countercyclical risk aversion can explain major puzzles such as the high volatility of asset prices. Evidence for its existence is, however, scarce because of the host of factors that simultaneously change during financial cycles. We circumvent these problems by priming financial professionals with either a boom or a bust scenario. Subjects primed with a financial bust were substantially more fearful and risk averse than those primed with a boom,…
The Role of Bounded Rationality and Imperfect Information in Subgame Perfect Implementation - An Empirical Investigation
The Role of Bounded Rationality and Imperfect Information in Subgame Perfect Implementation: An Empirical Investigation
The Role of Bounded Rationality and Imperfect Information in Subgame Perfect Implementation: An Empirical Investigation
On the psychology of poverty
Poverty remains one of the most pressing problems facing the world; the mechanisms through which poverty arises and perpetuates itself, however, are not well understood. Here, we examine the evidence for the hypothesis that poverty may have particular psychological consequences that can lead to economic behaviors that make it difficult to escape poverty. The evidence indicates that poverty causes stress and negative affective states which in turn…
Business culture and dishonesty in the banking industry
Can we see inside? Predicting strategic behavior given limited information
Discretion, Productivity, and Work Satisfaction
In Bartling, Fehr, and Schmidt (2012) we show theoretically and experimentally that it is optimal to grant discretion to workers if (i) discretion increases productivity, (ii) workers can be screened by past performance, (iii) some workers reciprocate high wages with high effort, and (iv) employers pay high wages leaving rents to their workers. In this paper we show experimentally that the productivity increase due to discretion is not only suffi…
Explaining altruistic behaviour in humans
This article presents evidence supporting strong reciprocity. It explains why, under conditions plausibly characteristic of the early stages of human evolution, a small fraction of strong reciprocators could invade a population of self-regarding types, and why strong reciprocity is an evolutionarily stable strategy. It uses the term ‘self-regarding’ rather than the more common term ‘self-interested’ to avoid the question as to whether it is selfi…
The role of testosterone in social interaction
Although animal researchers established the role of testosterone as a 'social hormone' decades ago, the investigation of its causal influence on human social behaviors has only recently begun. Here, we review and discuss recent studies showing the causal effects of testosterone on social interactions in animals and humans, and outline the basic neurobiological mechanisms that might underlie these effects. Based on these recent findings, we argue …
A Theory of Fairness, Competition, and Cooperation
There is strong evidence that people exploit their bargaining power in competitive markets but not in bilateral bargaining situations. There is also strong evidence that people exploit free-riding opportunities in voluntary cooperation games. Yet, when they are given the opportunity to punish free riders, stable cooperation is maintained, although punishment is costly for those who punish. This paper asks whether there is a simple common principl…
Fairness and Retaliation: The Economics of Reciprocity
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 of competition in markets with incomplete contracts and giv…
Explaining altruistic behavior in humans
Human Motivation and Social Cooperation: Experimental and Analytical Foundations
Since Durkheim, sociological explanations of social cooperation have emphasized the internalization of values that induce norm compliance. Since Adam Smith, economic explanations of social cooperation have emphasized incentives that induce selfish individuals to cooperate. Here, we develop a general approach-the Beliefs, Preferences, and Constraints approach-showing that each of the above models is a special case. Our approach is based on evidenc…
Why Social Preferences Matter – the Impact of non‐Selfish Motives on Competition, Cooperation and Incentives
Journal Article Why Social Preferences Matter – the Impact of non‐Selfish Motives on Competition, Cooperation and Incentives Get access Ernst Fehr, Ernst Fehr University of Zurich Search for other works by this author on: Oxford Academic Google Scholar Urs Fischbacher Urs Fischbacher University of Zurich Search for other works by this author on: Oxford Academic Google Scholar The Economic Journal, Volume 112, Issue 478, March 2002, Pages C1–C33, …
Redefine statistical significance
Strong reciprocity, human cooperation, and the enforcement of social norms
Wage Rigidity in a Competitive Incomplete Contract Market
Do employers and workers underbid prevailing wages if there is unemployment? Do employers take advantage of workers’ underbidding by lowering wages? We hypothesize that under conditions of incomplete labor contracts wage levels may positively affect workers’ propensity to cooperate. This, in turn, may prevent firms from underbidding or accepting the underbidding of workers. To get controlled evidence we conducted several experimental double aucti…
Caste and Punishment: The Legacy of Caste Culture in Norm Enforcement
Well-functioning groups enforce social norms that restrain opportunism, but the social structure of a society may encourage or inhibit norm enforcement. Here we study how the exogenous assignment to different positions in an extreme social hierarchy – the caste system – affectsnindividuals’ willingness to punish violations of a cooperation norm. Although we control for individual wealth, education, and political participation, low caste individua…
Introduction: Tastes, Castes and Culture: The Influence of Society on Preferences
Journal Article Introduction: Tastes, Castes and Culture: The Influence of Society on Preferences Get access Ernst Fehr, Ernst Fehr University of Zurich Search for other works by this author on: Oxford Academic Google Scholar Karla Hoff Karla Hoff World Bank Search for other works by this author on: Oxford Academic Google Scholar The Economic Journal, Volume 121, Issue 556, November 2011, Pages F396–F412, https://doi.org/10.1111/j.1468-0297.2011.…
Normative foundations of human cooperation
The promise and the peril of using social influence to reverse harmful traditions
Moral Sentiments and Material Interests: The Foundations of Cooperation in Economic Life
Moral Sentiments and Material Interests presents an innovative synthesis of research in different disciplines to argue that cooperation stems not from the stereotypical selfish agent acting out of disguised self-interest but from the presence of "strong reciprocators" in a social group. Presenting an overview of research in economics, anthropology, evolutionary and human biology, social psychology, and sociology, the book deals with both the theo…
Strong Reciprocity and the Roots of Human Morality
Neuroeconomic Foundations of Economic Choice-Recent Advances
Neuroeconomics combines methods and theories from neuroscience psychology, economics, and computer science in an effort to produce detailed computational and neurobiological accounts of the decision-making process that can serve as a common foundation for understanding human behavior across the natural and social sciences. Because neuroeconomics is a young discipline, a sufficiently sound structural model of how the brain makes choices is not yet…
The rise of affectivism
Time Will Tell: Recovering Preferences When Choices Are Noisy
Individual Irrationality and Aggregate Outcomes
In their personal lives, many economists recognize that they are surrounded by individuals who are less than fully rational. In their professional lives, however, economists often use models that examine the interactions of fully rational agents. To reduce the cognitive dissonance of this situation, many economists believe that interactions in markets will correct or offset individually anomalous behaviors-although the reasons for this belief are…
On Reputation: A Microfoundation of Contract Enforcement and Price Rigidity
We study the impact of reputational incentives in markets characterised by moral hazard problems. Social preferences have been shown to enhance contract enforcement in these markets, while at the same time generating considerable wage and price rigidity. Reputation powerfully amplifies the positive effects of social preferences on contract enforcement by increasing contract efficiency substantially. This effect is, however, associated with a cons…
Social exchange in the labor market: Reciprocity and trust versus egoistic money maximization
Human Altruism – Proximate Patterns and Evolutionary Origins
Are people selfish or altruistic? Throughout history this question has been answered on the basis of much introspection and little evidence. It has been at the heart of many controversial debates in politics, science, and philosophy. Some of the most fundamental questions concerning our evolutionary origins, our social relations, and the organization of society are centered around issues of altruism and selfishness. Experimental evidence indicate…
A registered replication study on oxytocin and trust
Fairness and the Optimal Allocation of Ownership Rights
We report on several experiments on the optimal allocation of ownership rights. The experiments confirm the property rights approach by showing that the ownership structure affects relationship‐specific investments and that subjects attain the most efficient ownership allocation despite starting from different initial conditions. However, in contrast to the property rights approach, the most efficient ownership structure is joint ownership. These…
Altruists with Green Beards
If cooperative dispositions are associated with unique phenotypic features (’green beards’), cooperative individuals can be identified. Therefore, cooperative individuals can avoid exploitation by defectors by cooperating exclusively with other cooperative individuals; consequently, cooperators flourish and defectors die out. Experimental evidence suggests that subjects, who are given the opportunity to make promises in face-to-face interactions,…
Involuntary Unemployment and Non-Compensating Wage Differentials in an Experimental Labour Market
FLWNO
Macht und Ökonomie Das Beispiel atomistischer Arbeitsmärkte
Die Problematik von Macht und Herrschaft ist ein altes sozialwissenschaftliches Thema. Es hat nicht an Versuchen gefehlt, diese Begriffe zu definieren und für die Analyse sozialer Phänomene fruchtbar zu machen. Die Diagnostizierung von Machtverhältnissen in sozialen Beziehungen ist in der Regel ein heiß umkämpftes ideologisches Terrain. Angesichts der allmählichen Durchsetzung demokratischer politischer Ordnungen und Werte — zumindest in den meis…
Does Fairness Prevent Market Clearing? An Experimental Investigation
This paper reports the results of an experiment that was designed to test the impact of fairness on market prices. Prices were determined in a one-sided oral auction, with buyers as price-makers. Upon acceptance of an offer, sellers determined the quality of the good. Buyers offered prices that were substantially above the market-clearing level and expected sellers to respond with high quality levels. This expectation was, on average, confirmed b…
Insider Power, Wage Discrimination and Fairness
The exercise of insider power is frequently considered as a major cause of involuntary unemployment. We show that under standard assumptions - insiders are selfish and they need not fear the loss of their job - insider power does not guarantee unemployment but the introduction of a market clearing two-tier system. Yet, while insider power is a common phenomen two-tier systems are rarely observed. We show that if outsiders exhibit a preference for…
Social exchange in the labor market: Reciprocity and trust versus egoistic money maximization
Involuntary Unemployment and Non-Compensating Wage Differentials in an Experimental Labour Market
FLWNO
Reciprocity as a Contract Enforcement Device: Experimental Evidence
FLWNO
Reciprocity and economics: The economic implications of Homo Reciprocans
Collective action as a social exchange
Wage Rigidity in a Competitive Incomplete Contract Market
Do employers and workers underbid prevailing wages if there is unemployment? Do employers take advantage of workers’ underbidding by lowering wages? We hypothesize that under conditions of incomplete labor contracts wage levels may positively affect workers’ propensity to cooperate. This, in turn, may prevent firms from underbidding or accepting the underbidding of workers. To get controlled evidence we conducted several experimental double aucti…
A Theory of Fairness, Competition, and Cooperation
There is strong evidence that people exploit their bargaining power in competitive markets but not in bilateral bargaining situations. There is also strong evidence that people exploit free-riding opportunities in voluntary cooperation games. Yet, when they are given the opportunity to punish free riders, stable cooperation is maintained, although punishment is costly for those who punish. This paper asks whether there is a simple common principl…
Cooperation and Punishment in Public Goods Experiments
Casual evidence as well as daily experience suggest that many people have a strong aversion against being the 'sucker' in social dilemma situations. As a consequence, those who cooperate may be willing to punish free-riding, even if this is costly for them and even if they cannot expect future benefits from their punishment activities. A main purpose of this paper is to show experimentally that there is indeed a widespread willingness of the coop…
Fairness and Retaliation: The Economics of Reciprocity
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 of competition in markets with incomplete contracts and giv…
Are people conditionally cooperative? Evidence from a public goods experiment
In Search of Homo Economicus: Behavioral Experiments in 15 Small-Scale Societies
In Search of Homo Economicus: Behavioral Experiments in 15 Small-Scale Societies by Joseph Henrich, Robert Boyd, Samuel Bowles, Colin Camerer, Ernst Fehr, Herbert Gintis and Richard McElreath. Published in volume 91, issue 2, pages 73-78 of American Economic Review, May 2001
Psychological foundations of incentives
During the last two decades economists have made much progress in understanding incentives, contracts and organizations. Yet, they constrained their attention to a very narrow and empirically questionable view of human motivation. The purpose of this paper is to show that this narrow view of human motivation may severely limit understanding the determinants and effects of incentives. Economists may fail to understand the levels and the changes in…
Why Social Preferences Matter – the Impact of non‐Selfish Motives on Competition, Cooperation and Incentives
Journal Article Why Social Preferences Matter – the Impact of non‐Selfish Motives on Competition, Cooperation and Incentives Get access Ernst Fehr, Ernst Fehr University of Zurich Search for other works by this author on: Oxford Academic Google Scholar Urs Fischbacher Urs Fischbacher University of Zurich Search for other works by this author on: Oxford Academic Google Scholar The Economic Journal, Volume 112, Issue 478, March 2002, Pages C1–C33, …
Strong reciprocity, human cooperation, and the enforcement of social norms
Reasons for Conflict: Lessons from Bargaining Experiments
In this paper we experimentally study the effects of fairness, spite, and reputation formation on conflict. We show that fairness preferences are a potential source of conflict and that intentions play an important role in the perception of fairness. Further, we show that feelings of spite may affect the occurrence of conflict. Finally, we study reputation formation as a possible source of conflict. We show that people invest in a reputation of b…
The nature of human altruism
On the Nature of Fair Behavior
This article shows that identical offers in an ultimatum game generate systematically different rejection rates depending on the other offers that are available to the proposer. This result casts doubt on the consequentialist practice in economics to define the utility of an action solely in terms of the consequences of the action irrespective of the set of alternatives. It means in particular that negatively reciprocal behavior cannot be fully c…
Detrimental effects of sanctions on human altruism
Explaining altruistic behavior in humans
Foundations of Human Sociality
This book is the result of a collaborative effort by eleven anthropologists and six economists, and questions the motives that underlie the ways that humans interact socially, and whether these are the same for all societies, and are part of our nature, or are influenced by our environments. Over the past decade, research in experimental economics has emphatically falsified the textbook representation of Homo economicus, with hundreds of experime…
The Hidden Costs and Returns of Incentives—Trust and Trustworthiness among Ceos
We examine experimentally how Chief Executive Officers (CEOs) respond to incentives and how they provide incentives in situations requiring trust and trustworthiness. As a control we compare the behavior of CEOs with the behavior of students. We find that CEOs are considerably more trusting and exhibit more trustworthiness than students—thus reaching substantially higher efficiency levels than students. Moreover, we find that, for CEOs as well as…
Social norms and human cooperation
Economics (56 works) · Experimental Behavioral Economics Studies (48 works) · Psychology (48 works) · Social Psychology (43 works) · Microeconomics (39 works) · Political science (35 works) · Positive economics (27 works) · Evolutionary Game Theory and Cooperation (23 works) · Culture, Economy, and Development Studies (22 works) · Sociology (19 works)