Although many real bargaining situations involve more than two people, much of the theoretical and experimental research concentrates on the two player situation. We study the simplest possible extension: four people (two two-person groups) of different patience bargain with each other....

In reality, it is often groups rather than individuals that make decisions. In previous experiments, groups have frequently been shown to act differently from individuals in several ways. It has been claimed that inter-group interactions may be (1) more competitive, (2) more rational, or (3)...

Does geographic distance or the perceived social distance between subjects significantly affect proposer and responder behavior in ultimatum bargaining? To answer this question, subjects play a one-shot ultimatum game with three players (proposer, responder, and a passive dummy player) and...

Can two negotiators fail to agree when both the size of the surplus and the rationality of the negotiators are common knowledge? We show that the answer is affirmative. When the negotiators can make irrevocable commitments at a low but positive cost, the unique symmetric equilibrium entails...

Following entrance into the European Union, Central Eastern European Countries (CEECs) are expected to join the European Monetary Union (EMU). These countries may incur considerable costs over the course of their passing through the required Exchange Rate Mechanism II (ERM-II). However, with...

The study of gender differences in social preferences has shown mixed results, preventing economists and other social scientists from drawing definitive conclusions on this topic. Several original investigations and experimental reviews have hypothesized that the main reason of this...

We experimentally investigate how affective processes influence proposers' and responders' behaviour in the Ultimatum Game. Using a dualsystem approach, we tax cognitive resources through time pressure and cognitive load to enhance the influence of affective processes on behaviour. We find that...

During the last three decades the ascent of behavioral economics clearly helped to bring down artificial disciplinary boundaries between psychology and economics. Noting that behavioral economics seems still under the spell of the rational choice tradition and, indirectly, of behaviorism we...

In line with the widely applied principle of just deserts, we assume that the severity of the penalty on a contract offender increases in the harm on the other. When this principle holds, the influence of the efficiency of the agreement on the incentives to abide by it crucially depends on...

Most research in economics models agents somehow motivated by outcomes. Here, we model agents motivated by procedures instead, where procedures are defined independently of an outcome. To that end, we design procedures which yield the same expected outcomes or carry the same information on...