Social Preferences? Google Answers!1

We analyse pricing, eort and tipping decisions in the online service 'Google Answers'. While users set a price for the answer to their question ex ante, they can additionally give a tip to the researcher ex post. The obtained data set is analysed and compared to the results of similar laboratory experiments, namely Fehr, Gächter and Kirchsteiger (1997) and Gächter and Falk (2002). Recipro- cal theories of social preferences pioneered by Rabin (1993) and extended by Dufwenberg and Kirchsteiger (2004) are useful to explain the observed pattern of behaviour. In line with the related experimental literature we conclude that an open contracts design encourages people to tip. We …nd evidence that this is mo- tivated by reciprocity, but also by reputation concerns among frequent users. Moreover, researchers seem to adjust their eort based on the user's previous tipping behaviour. An e¢ cient sorting takes place when a su¢ cient tip history is available. Users known for tipping in the past receive higher eort answers, while users with an established reputation for non-tipping tend to get low eort answers.