We analyze both theoretically and empirically how monetary incentives and information about others’ behavior affect dishonesty. We run a laboratory experiment with 560 participants, each of whom observes a number from one to six with there being a payoff associated with each number. They can...

In sequential interactions, both the agent’s intention and the outcome of his choice may influence the principal’s action. While outcomes are typically observable, intentions are more likely to be hidden, leaving potential wiggle room for the principal when deciding on a reciprocating...

Imitating the best strategy from the previous period has been shown to be an important heuristic, in particular in relatively complex environments. In this experiment we test whether subjects are more likely to use imitation if they are under stress. Subjects play a repeated Cournot oligopoly....

In many economic contexts, an elusive variable of interest is the agent's belief about relevant events, e.g. about other agents' behavior. A growing number of surveys and experiments ask participants to state beliefs explicitly but little is known about the causal relation between beliefs and...

In Buy-It-Now (BIN, hereafter) auctions, sellers can make a "take-it-or-leave-it" price offer (BIN price) prior to an auction. We analyse experimentally how eBay sellers set BIN prices and whether they benefit from offering them. Using the real eBay environment in the laboratory, we find that...

Overbidding in auctions has been attributed to e.g. risk aversion, loser regret, level-k, and cursedness, relying on varying identifying assumptions. I argue that "type projection" organizes these findings and largely captures observed behavior. Type projection formally models that people tend...

Informal exchange of information among competitors has been well-documented in a variety of industries, and one's expectation of reciprocity shown to be a key determinant. We use an indeterminate horizon centipede game to establish a feedback loop in the laboratory and show that an individual's...

This paper experimentally studies two simple interventions aimed at increasing public goods provision in settings in which accurate feedback about contributions is not available. The first intervention aims to exploit lying aversion by requiring subjects to send a non-verifiable ex post...

Anchoring is one of the most studied and robust behavioral biases, but there is little knowledge about its persistence in strategic settings. This article studies the role of anchoring bias in private-value auctions. We test experimentally two different anchor types. The announcement of a random...

We study theoretically and experimentally the role of fatigue and recovery within a competitive work environment. At work, agents usually make their effort choice in response to competition and monetary incentives. At the same time, they have to take into account fatigue, which accumulates over...