Catastrophic events can dramatically alter existing social and economic relationships. The consequences can be long-lasting and give rise to heterogeneity of behavior across populations. We investigate the impact of a large negative shock on altruism, trust and reciprocity in 30 small Honduran...

We present a set of experimental coordination games with a payoff-dominant and a risk-dominant Nash equilibrium. We examine how much local interaction structures affect players' strategy choices. Our three major observations are the following: First, local interaction with open neighborhoods...

In a series of experimental effort games each of two players may choose between remuneration based on either private or team effort. Although at least one of the players has the subgame perfect equilibrium strategy to choose remuneration based on private effort, we frequently observe team...

A conjecture of Laffer, which had considerable influence on fiscal doctrine, is that tax revenues of a Leviathan state eventually decrease when the tax rate exceeds a threshold value. We conduct a real effort experiment, in which a worker is matched with a non-working partner, to elicit the...

We examine decision making in a simple supplier-retailer wholesale price contract in the experimental economics laboratory. We observe wholesale prices and order quantities below the game-theoretical predictions. The supply chain's efficiency is as predicted but profits are more equitably...

In an experimental 2x2 coordination game with two strict equilibria we observe that, in contrast to equilibrium selection theory (Harsanyi and Selten 1988), only half of the subjects choose the strategy that relates to the payoff- and risk-dominant equilibrium. We propose modified risk dominance...