Social interactions predominantly take place under the shadow of the future. Previous literature explains cooperation in indefinitely repeated prisoner's dilemma as predominantly driven by self-interested strategic considerations. This paper provides a causal test of the importance of social...

Matching markets can be unstable when individuals prefer to be matched to a partner who also wants to be matched with them. Through a pre-registered and theory-guided laboratory experiment, we provide evidence that such reciprocal preferences exist, significantly decrease stability in matching...

We investigate experimentally whether entry costs have an impact on the evolutionof cooperation in a social dilemma game. In particular, subjects repeatedly playthe so-called takeover game with anonymous partners randomly drawn from a fixedpopulation of participants. The game represents a social...

In experimental bargaining with incomplete information, we vary the information distribution (symmetric and asymmetric), the direction of electronic prepaycommunication (no, one-way, and two way), and the electronic communication medium (email and video) Bargainig outcomes are influenced by the...

This paper analyzes fairness and bargaining in a dynamic bilateral matching market. Traders from both sides of the market are pairwise matched to share the gains from trade. The bargaining outcome depends on the traders' fairness attitudes. In equilibrium fairness matters because of market...

This paper analyzes fairness and bargaining in a dynamic bilateral matching market. Traders from both sides of the market are pairwise matched to share the gains from trade. The bargaining outcome depends on the traders' fairness attitudes. In equilibrium fairness matters because of market...

The common use of majority rule in group decision making is puzzling. In theory, it inequitably favors the proposer, and paradoxically, it disadvantages voters further if they are inequity averse. In practice, however, outcomes are equitable. The present paper analyzes data from a novel...

In business and politics, gifts are often aimed at influencing the recipient at the expense of third parties. In an experimental study, which removes informational and incentive confounds, subjects strongly respond to small gifts even though they understand the gift giver's intention. Our...

Why do people give when asked, but prefer not to be asked, and even take when possible? We show that standard behavioral axioms including separability, narrow bracketing, and scaling invariance predict these seemingly inconsistent observations. Specifically, these axioms imply that...

Using a new experimental design, we compare how subjects form beliefs in an investor-client setup under varying degrees of liability. Our results reflect the importance of social preferences when making investment decisions for others. We show that when investors have no liability, those with...