Condition-dependent trade-offs maintain honest signaling
In this study we present the results of a laboratory experiment with human participants to test the role of equilibrium signal cost and signalling trade-offs for the development of honest communication. Experimental setup Participants played a simple 2x2 signaling game in a computer lab. 12 sessions were organized, involving different numbers of participants (groups of 12, 16, and 20). A total of 196 students participated in the experiment. A mix of within and between subject design was applied: within a session, each group played three of the nine treatment conditions. Each condition was played as the first, second and third game through 20 rounds each. Since the order of games and the number of participants (Bruner et al. 2014) may affect the speed of learning dynamics in the game, we control for these factors with statistical methods during the analysis. The experiment took place at the Corvinus University of Budapest (CUB) in Hungary between 25th January 2018 and 15th January 2019. Participants were regular or corresponding students and one experiment lasted for approx. 45 minutes. During the experiment, participants were seated randomly in front of the computers, thus participants took part in the experiment anonymously. Computers were connected on a local network with the help of the software z-Tree (Fischbacher 2007). The description of the game was included in the experimental instructions (see S4.) and displayed on participants’ screens. They got the instructions on paper as well because roles participants played in the game have changed round-by-round. In the first step, participants were divided into groups of fours which contained two signalers (S) and two receivers (R). We used unbiased signaling game, where the two types of signaler (S in high condition and S in low condition) were assigned randomly by the computer. Everyone was only aware of their own type, they did not know each other's condition. In the next step, signalers had to choose a signal and send it to the receiver to get the resource. Distinguishable characters were used as signals (e.g. )( and ~ ) and their costs (or benefits) were displayed next to each signal depending on which condition was played. In the next step, receivers had to decide whether they would give the resource after a signal was seen. Signalers succeed if they receive the resource, but receivers’ success depended on the (hidden) type of the signaler (S in high condition was preferred to S in low condition). After these steps, participants have learned the type of the sender, the signal they sent and the success of their decision. In case of a successful decision, they received HUF 1200. The other factor that influenced the payments was the cost of the signals (see Table 1). In addition, participants received a show-up fee of HUF 1000.