Fooling the Nice Guys: Explaining receiver credulity in a public good game with lying and punishment

•Looks at why people believe cheap talk messages of others in a public good setting.•In a public good game, subjects make unverifiable, post hoc contribution announcements.•Those with a high tendency to contribute have inflated beliefs about the contribution of others.•This influences their subsequent contribution and punishment decisions.•Thus, credulity is driven by the individual's own contribution tendencies. We demonstrate that receiver credulity can be understood through a false consensus effect: the likelihood with which individuals believe messages about the behavior of others can be explained by their own behavioral tendencies in a comparable situation. In a laboratory experiment, subjects play a public good game with punishment in which feedback on actual contributions is obscured. Instead, subjects communicate what they have contributed through a post hoc announcement mechanism. Using subjects’ social value orientation as a proxy for their contribution tendency, we show that those high on the measure have inflated beliefs about the contribution of others. This, in turn, impacts their contribution and punishment decisions.