The widespread use of markets leads to unprecedented material well-being in many societies. We study whether market interaction, as a side effect, erodes moral values. An encompassing understanding of the virtues and vices of markets, including their possible impact on moral values, is necessary...

We experimentally investigate behavior and beliefs in a sequential prisoner’s dilemma. Each subject had to choose an action as first-mover and a conditional action as second-mover. All subjects also had to state their beliefs about others’ second-mover choices. We find that subjects’...