We test experimentally an explanation of over and under confidence as motivated by (perhaps unconscious) strategic concerns, and find compelling evidence supporting this hypothesis in the behavior of participants who send and respond to others’ statements of confidence about how well they have...

Institutions are important for proper economic performance, but are replaceable by trust or other social norms. We show that when proper institutions and trust are missing, integrity of the individuals can replace them. We construct a model of a transactions-based economy with contracts...

This paper derives and justifies a procedurally fair bidding mechanism and reviews experiments that apply the mechanism to public projects provision. In the experiments, not all parties benefit from provision, and the projects’ costs can be negative. The experimental results indicate that the...