Open access
Date
2013-05Type
- Working Paper
ETH Bibliography
yes
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Abstract
This paper investigates the impact of four key economic variables on an expert firm’s incentive to defraud its customers in a credence goods market: the level of competition, the expert firm’s financial situation, its competence, and its reputational concerns. We use and complement the dataset of a na-tionwide field study conducted by the German Automobile Association that regularly checks the reliability of garages in Germany. We find that more in-tense competition and high competence lower firms’ incentive to overcharge. A low concern for reputation and a critical financial situation increase the incentive to overcharge. Show more
Permanent link
https://doi.org/10.3929/ethz-a-009768078Publication status
publishedJournal / series
Economics Working Paper SeriesVolume
Publisher
ETH Zurich, Center of Economic Research (CER-ETH)Subject
Asymmetric information; Auto repair market; Credence goods; Expert; Fraud; OverchargingOrganisational unit
02045 - Dep. Geistes-, Sozial- u. Staatswiss. / Dep. of Humanities, Social and Pol.Sc.
Related publications and datasets
Is previous version of: http://hdl.handle.net/20.500.11850/318418
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ETH Bibliography
yes
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