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Anderlini, Luca; Felli, Leonardo - London School of Economics (LSE) - 1998

We identify the inefficiencies that arise when negotiation between two parties takes place in the presence of transaction costs. First, for some values of these costs it is efficient to reach an agreement but the unique equilibrium outcome is one in which agreement is never reached. Secondly,...

Persistent link: https://www.econbiz.de/10010928645

Transaction costs and the robustness of the Coase Theorem

Anderlini, Luca; Felli, Leonardo - London School of Economics (LSE) - 2000

This paper explores the extent to which the presence of ex-ante transaction costs may lead to failures of the Coase Theorem. In particular we identify and investigate the basic ‘hold-up problem’ which arises whenever the parties to a Coasian negotiation have to pay some ex-ante costs for the...

Persistent link: https://www.econbiz.de/10010745037

Costly coasian contracts

Anderlini, Luca; Felli, Leonardo - London School of Economics (LSE) - 1998

We identify and investigate the basic ‘hold-up problem’ which arises whenever each party to a contract has to pay some ex-ante cost for the contract to become feasible. We then proceed to show that, under plausible circumstances, a ‘contractual solution’ to this hold-up problem is not...

Persistent link: https://www.econbiz.de/10010745370

Monitoring and Pay:An Experiment on Employee Performance under Endogenous Supervisiona

Dittrich, Dennis A. V.; Kocher, Martin G. - Max-Planck-Institut für Ökonomik <Jena> / Abteilung … - 2006

We present an experimental test of a shirking model where monitoring intensityis endogenous and effort a continuous … maximization problem of the firm. As a result, monitoring and pay shouldbe complements. In our experiment, between and within …

Persistent link: https://www.econbiz.de/10005866658

The Decision Maker Matters: Individual versus Group Behaviour in Experimental Beauty-Contest Games

Kocher, Martin G.; Sutter, Matthias - Max-Planck-Institut für Ökonomik <Jena> / Abteilung … - 2004

Economics has devoted little attention so far as to whether the type of decision maker matters for economic decisions. However, many important decisions like those on monetary policy or a company’s business strategy are made by (small) groups rather than an individual. We compare behaviour of...

Persistent link: https://www.econbiz.de/10005866848

Time is money –Time pressure, incentives, and the quality of decision-making

Kocher, Martin G.; Sutter, Matthias - Max-Planck-Institut für Ökonomik <Jena> / Abteilung … - 2004

Many decisions in economics and finance have to be made under severe time pressure. Furthermore, payoffs frequently depend on the speed of decision-making, like, for instance, when buying and selling stocks. In this paper, we examine the influence of time pressure and time-dependent incentive...

Persistent link: https://www.econbiz.de/10005866854

Age and the development of trust and reciprocity

Sutter, Matthias; Kocher, Martin G. - Max-Planck-Institut für Ökonomik <Jena> / Abteilung … - 2003

We examine the degree of trust and reciprocity in an experimental trust game with 662 participants from six different age groups, ranging from 8 year old primary school children to retired persons in their late sixties. Although both trust and reciprocity have been identified as fundamental...

Persistent link: https://www.econbiz.de/10005866861

Individual versus group behavior and the role of the decision making procedure in gift-exchange experiments

Kocher, Martin G.; Sutter, Matthias - Max-Planck-Institut für Ökonomik <Jena> / Abteilung … - 2002

We test for behavioral differences between groups and individuals in gift-exchange experiments. Related studies …

Persistent link: https://www.econbiz.de/10005867021

Preference reversals and the analysis of income distributions

Amiel, Yoram; Cowell, Frank; Davidovitz, Leima; … - London School of Economics (LSE) - 2003

It is known from the literature on uncertainty that in cases where individuals express a preference for a high win-probability bet over a bet with high winnings they nevertheless will bid more to obtain the bet with high winnings. We investigate whether a similar phenomenon applies in the...

Persistent link: https://www.econbiz.de/10010928778

Perceptions of risk : an experimental approach using internet questionnaires

Cowell, Frank; Cruces, Guillermo - London School of Economics (LSE) - 2003

Building on previous studies on perceptions of inequality, welfare and risk we investigate the structure of individuals …' rankings of uncertain prospects in terms of risk and their relationship to individual preferences. We examine three interlinked … propositions that are fundamental to the standard economic approach to risk: (i) that rankings by risk are simply the reverse of …

Persistent link: https://www.econbiz.de/10010744849