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Unformatted text preview: le’’ window (upper
right-hand side), the ‘‘Message to Player B’’ window (bottom left-hand side), and the ‘‘history’’ window (bottom right-hand side). Subjects use the average payoff table window to
select their choices. This window also shows the expected payoff matrix for all nine audit/
fraud combinations (the experimental materials refer to audits as beliefs). In Figure 1, the
manager has selected Action 3 (cheat) and Belief about the audit level 1 (trust). The Average
Payoff Table portion of the screen highlights the expected payoffs for both players, with
the payoffs to the auditor (manager) in the top (bottom) row so each player can see the
other player’s expected payoffs for each combination.
The Game Tree window in the upper left-hand side of the screen shows the probabilities
and the amounts for the audit/fraud combination selected in the Average Payoff Table. As
noted above, the manager has chosen the trust/cheat combination. The left branch of the
7 8 This approach does not represent deceit, merely that the information was not commonly known (Roth 1987). An
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- Fall '08