Groups, companies, and organizations identify themselves via symbols. Symbols have the potential to create group identity and at the same time create group boundaries, thus allowing for achieving the benefits of cooperation by ingroup members. We use a laboratory experiment to study the role of...

We contribute to the theory of the firm by experimentally investigating a bilateral trade relationship in which standard theory assuming self-regarding preferences predicts that the seller will be better off by investing in the outside option to improve his bargaining position. The seller’s...

We study whether group identity helps mitigate inefficiencies associated with appropriable quasi-rents, which are often created by relationship-specific investments in bilateral trade relationships. Based on previous findings that group identity strengthens other-regarding preferences, we...

Employing a two-by-two factorial design that manipulates whether dictator groups are single or mixed-sex and whether procedures are single or double-blind, we examine gender effects in a standard dictator game. No gender effects were found in any of the experimental treatments. Moreover, neither...

People feel a sense of gratitude when they receive gifts, transfers, or assistance. Based on psychological literature, I argue that gratitude is different from standard notions of reciprocity. Indeed, people derive utility from in-kind transfers (i.e., feel grateful), even if they do not like or...

The hold-up problem has played a central role in the study of firm boundaries, which is a fundamental element of the economic study of organizations. We study a previously unex-plored mechanism by which integration between two parties could resolve the problem. Based on the social identity...