An experimental approach is used to study ethnic discrimination within the Israeli Jewish society. Our experiment indicates that the segmented structure of Israeli society manifests itself in a consistent pattern of mistrust. In a trust game that we studied, money transferred to players of...

We explore sequential voting in symmetric two-option environments. We show that the (informative) symmetric equilibria of the simultaneous voting game are also equilibria in any sequential voting structure. In unanimity games, (essentially) the whole set of equilibria is the same in all...

In designing public policy it is not enough to consider the possible reaction of individuals to the chosen policy. Public policy may also affect the formation of preferences and norms in a society. The endogenous evolution of preferences, in addition to introducing a conceptual difficulty in...

Several authors have indicated a contradiction between consistent aggregation of subjective beliefs and tastes, and a Pareto condition. We argue that the Pareto condition that implies the contradiction is not compelling. Society should not necessarily endorse a unanimous choice when it is based...

This paper examines the effects of strategic delegation in a simple ultimatum game experiment. Our main concern is to examine the effect of delegation on the way players think about the game and how the play it.

We study the Nash bargaining solution of a problem in which two agents bargain over an uncertain outcome. Under the assumptions of risk neutrality and of constant absolute risk aversion, we study the way that solution varies, ex ante, when we vary the beliefs of one agent. Changing an agent`s...

In a self-confirming equilibrium, each player correctly forecasts the actions that opponents will take along the equilibrium path, but may be mistaken about the way that opponents would respond to deviations. This models a steady state of a learning process in which players observe actions...

There is a broad range of phenomena that are categorized as "mental accounting". Some of these phenomena may be viewed as situations in which a person evaluates decisions based on the implicit assumption that the decision she makes at a given moment will be repeated many times in the future. For...