An Experimental Investigation of Fairness and Reciprocal Behavior in a Triangular Principal–Multiagent Relationship

Issues of fairness in hierarchies have been mostly investigated – both theoretically and experimentally – within dyadic principal–agent relationships. In this paper we consider triangular principal–multiagents structures, integrating vertical hierarchical relationships with horizontal agent–to–agent ones. We explore in the laboratory a game that allows to investigate how principal’s fairness affects cooperation between two interdependent agents performing a simple production task. Our experimental findings show that perceived fairness of principal’s actions may trigger reciprocation in agents’ behavior, affecting how agents play the production game. JEL Classification: C72, C92.