When an employee in a gift exchange game earns significantly less than the employer, the source of employer income does not affect effort choices. However, to induce one unit of effort, the employer has to pay higher wages than in a game without payoff inequality.

How do people react to a mix of good deeds to a third party and bad deeds against them? A modified ultimatum game shows that previous good deeds make responders substantially more tolerant to unfair proposals.

Shotgun clauses are commonly included in the business agreements of partnerships and limited liability companies (LLCs), but the role of offeror typically remains unassigned. In a common-value, one-sided asymmetric information setting, unequal and inefficient outcomes occur with an unassigned...

We analyze a task-assignment model in which a principal assigns a task to one of two agents depending on future states. If the agents have concave utility, the principal assigns the task to them contingent on the state. We show that if the agents are loss averse, a state-independent...

In a one-shot Prisoners’ dilemma experiment, female participants are highly sensitive to the social frame. Male participants are not.

It has been shown that participants in the dictator game are less willing to give money to the other participant when their choice set also includes the option to take money. We examine whether this effect is due to the choice set providing a signal about entitlements in a setting where...

We conduct a laboratory experiment and provide evidence of learning spillovers within and across equivalence classes of “structurally similar” games. These spillovers are inconsistent with existing theories of learning in games.

Do corrupt people self select themselves in professions where the scope of corruption is high? We conduct a corruption experiment with private sector job aspirants and aspirants of Indian bureaucracy. The game models embezzlement of resources in which “supervisors” evaluate the performance...