High reputation stakes create strong incentives to counterfeit protection credentials.

Evidence

The world they describe is one where false pretenses are not difficult to maintain, where counterfeiting the ability to provide protection is a viable option. Even if someone is uncertain as to whether a mafioso is genuine or a fake, he will often choose to comply, for as a rule human beings are unlikely to call someone’s bluff when their lives may be at stake. Thus, the high value of reputation in this trade relative to other trades, together with the small amount of disinformation required to convince victims, represents an incentive for fraud. — Diego Gambetta, The Sicilian Mafia The Business of…, 116

Categorization

• XREF: The fraud-incentive logic mirrors Milgrom et al. on why reputation systems need gatekeeping — and why identification must be made unambiguous. — connects to: Consumer credit and mass prosperity enable widespread symbolic status counterfeiting. — W. David Marx, Status and Culture: How Our Desire for…, 232; Anyone can counterfeit status symbols because signification inherently permits lying. — W. David Marx, Status and Culture: How Our Desire for…, 231