In games with strategic complementarities, public information about the state of the world has a larger impact on equilibrium actions than private information of the same precision, because the former is more informative about the likely behavior of others. This may lead to welfare-reducing...

This paper presents a choice model based on a model for the behavior of brain cells that is based on neurological findings. The paper shows that it is possible to define choice as the result of a series of interconnected cellular processes, instead of framing the problem from the point of view...

We provide experimental evidence on the emergence of redistributive societies. Individuals first vote on redistribution by feet and then learn their productivity and invest. We vary the individuals’ information about their productivities at the time when they choose a distribution rule and...

We compare performance in a word based creativity task under three incentive schemes: a flat fee, a linear payment and a tournament. Furthermore, we also compare performance under two control tasks (Raven’s advanced progressive matrices or a number-adding task) with the same treatments. In all...

Experimental and behavioral economics are well established branches in the economic science. This essay presents and discusses some results and behavioral regularities from these fields which are of potential importance for public policy. After a brief introduction of what experimental and...

In this paper we present three simple theoretical models to explain the influence of the possibility to make non-binding announcements on investment behaviour in public goods settings. Our models build on the idea that voluntary contributions to the supply of a public good might be motivated by...

We experimentally test overconfidence in investment decisions by offering participants the possibility to substitute their own for alternative investment choices. Overall, 149 subjects participated in two experiments, one with just one risky asset, the other with two risky assets. Overconfidence...

The public finance literature demonstrates the equivalence between consumption and labor income (wage) taxes. We construct an environment in which individuals make real labor-leisure choices and spend their earned income on real goods. We use this experimental framework to test whether a labor...

In this experiment, we analyze strategic delegation in a Cournot duopoly. Owners can choose among two different contracts which determine their managers' salaries. One contract simply gives managers incentives to maximize firm profits, while the second contract gives an additional sales bonus....

According to the Framework Convention on Climate Change, global collective action is needed to stabilize “greenhouse gas concentrations in the atmosphere at a level that would prevent dangerous [our emphasis] anthropogenic interference with the climate system.” The Framework Convention thus...