Abstract: We report results from three well-known experimental paradigms, where we use time, rather than money, as the salient component of subjects’ incentives. The three experiments, commonly employed to study social preferences, are the dictator game, the ultimatum game and the trust game....

We study social preferences in a three-person ultimatum game experiment with one proposer and two responders.Any responder can unilaterally punish the proposer.In three treatments, we vary the pecuniary consequences of rejection in such a way that upon rejection of one responder the other...

Economic research overwhelmingly shows that the utility individuals derive from their income depends on the incomes of others. Theoretical literature has proven that these status effects imply a more egalitarian income policy than in the conventional case, in which people value their income...

Abstract Introducing a ceiling on total carbon dioxide (CO2) emissions and allowing polluting industries to buy and sell permits to meet it (known as a cap-and-trade system) affects investment strategies, generation quantities, and prices in electricity markets. In this paper we analyze these...

In a bilateral trade framework, we examine the impact of tari¤ reduction on the op- timal pollution tax and social welfare when pollution is transboundary. Strategic considerations lead countries to distort their pollution tax in the non-cooperative equilibrium. Trade liberalization changes the...

In this paper we show that free entry decisions may be socially inefficient, even in a perfectly competitive homogeneous goods market with non-lumpy investments. In our model, inefficient entry decisions are the result of risk-aversion of incumbent producers and consumers, combined with...